Answer:
Approx. $48,443.25, if rounding up to the hundredths place.
Step-by-step explanation:
For this problem, use the formula for compound interest:
a = p(1 + r/n)^nt
- P represent the initial amount placed in an account.
- R is the interest rate.
- N is the number of times the interest rate is compounded; If compounded once a year or annually, n would be equal to one.
- T is the amount of time.
So, based on the question, we can fill in some of the formula. "7800 dollars is placed in an account", "annual interest rate of 6.5", and "after 29 years" tell us what the variables above stand for within this problem.
I then filled in the formula (this is assuming the interest rate is 6.5%) :
a = 7800(1 + .065/1)^29
Now we solve-
1. First, solve within the parenthesis:
a = 7800(1.065^1)^29
2. Solve the exponent outside of the parenthesis:
a = 7800 * 6.21067245356
3. Multiply:
a = 48,443.245137768 or approx. $48,443.25
