Based on the given parameters, the amount of the investment after 4 years is $1030
<h3>How to determine the amount?</h3>
The given parameters about the compound interest are
Principal Amount, P = $1000
Interest Rate, R = 0.85%
Time, t = 4
Number of times, n = 1 i.e. annually
Compound interests are different from simple interest, and they are calculated using the following compound interest formula
CI = P(1 + R/n)^nt - P
To calculate the amount, we have:
A = P + CI
So, the equation becomes
A = P + P(1 + R/n)^nt - P
Evaluate the like terms
A = P(1 + R/n)^nt
Substitute the known values in the above equation
A = 1000 * (1 + 0.85%/1)^(1 * 4)
Express 0.85% as decimal
A = 1000 * (1 + 0.0085/1)^(1 * 4)
Evaluate the sum
A = 1000 * (1.0085/1)^(1 * 4)
Evaluate the exponent
A = 1000 * 1.03
Evaluate the product
A = 1030
Hence, the value of the investment is $1030
Read more about compound interest at:
brainly.com/question/24924853
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