What is the value of x?
2 answers:
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Answer:
$29,721
Step-by-step explanation:
We have been given that Wyatt is investing money into a savings account that pays 2% interest compounded annually, and plans to leave it there for 15 years. We are asked to find the amount deposited by Wyatt in order to have a balance of $40,000 in his savings account after 15 years.
We will use compound interest formula to solve our given problem.
, where,
A = Final amount after T years,
P = Principal amount,
r = Annual interest rate in decimal form,
n = Number of times interest is compounded per year,
T = Time in years.
Let us convert our given interest rate in decimal form.
Upon substituting our given values in compound interest formula, we will get:
Switch sides:
Upon rounding our answer to nearest dollar, we will get:
Therefore, Wyatt will have to invest $29,721 now in order to have a balance of $40,000 in his savings account after 15 years.