Question

Tom opens a bank account and makes an initial deposit of 500$. Then banker tells Tom that he is going to receive an annual rate of 6% on his investment. Find the bank balance assuming Tom leaves the account untouched for 15 years. (Will give brainliest to the person who has the answer correct and will shown work.)

Answer 1

$~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill &\ 500\\ r=rate\to 6\%\to \frac{6}{100}\dotfill &0.06\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{annually, thus once} \end{array}\dotfill &1\\ t=years\dotfill &15 \end{cases} \\\\\\ A=500\left(1+\frac{0.06}{1}\right)^{1\cdot 15}\implies A=500(1.06)^{15}\implies A\approx 1198.28$