Question

If you invest $ 30 , 700 with an annual interest rate of 8.9 % , compounded daily, how much would you have at the end of 4 years?

Answer 1

Answer: $43,823.37

Step-by-step explanation:

Formula to calculate the accumulated amount earned on principal (P) at rate of interest (r) compounded daily after t years :

$A=P(1+\dfrac{r}{365})^{365t}$

As per given , we have

P= $ 30,700

r= 8.9 % = 0.089

t= 4 years

$A=30700(1+\dfrac{0.089}{365})^{365(4)}\\\\=30700(1+0.0002438)^{365(4)}\\\\=30700(1.0002438)^{1460}\\\\=30700(1.42747138525)\\\\=43823.3715272\approx43823.37$

Hence, the amount at the end of 4 years would be $43,823.37 .