Question

On your birthday, your uncle gave you the money in his savings account. His only deposit was Rs.100 made 50 years ago. The savings account paid 8% compounded annually. How much money is in the account today?

Answer 1

4,690.161

Step-by-step explanation:

The amount in the account is equal to the value of Rs.100 deposited 50 years ago, earning at 8% compound interest. The interest is compounded once per year.

The formula for calculating compound interest is.

FV = PV × (1+r)^n

where FV = Future Value

PV = Present Value...Rs 100

r = annual interest rate..8%

n = number of periods..50

Fv= 100 x ( 1 + 8/100)^50

Fv= 100 x (1+0.08)^50

Fv=100 x (1.08)^50

Fv= 4,690.161

Amount in the account = Rs. 4,690.16