Question

Tyler has earned money by helping out on a neighbor's farm and now wants to put his earnings in a savings account. He is a bit confused on the different interest options available and how each will impact the amount he has after several years. Help Tyler better understand by showing him how his money will increase in an account that uses simple interest and one that uses compound interest over a specified period of time.
If Tyler deposits $1500 of the $3200 he has earned in an account that pays 4% interest compounded annually, how much will he have in his account after 5 years?

Answer 1

The awnser is $1800
1500*.04*5= 1800