Question

suppose your friends parents invest $15000 in an account paying 6% compounded annually. what will the balance be after 8 years

Answer 1

Answer:

$23,907.72

Step-by-step explanation:

Lets use the compound interest formula to solve:

$A=P(1+\frac{r}{n} )^{nt}$

P = initial balance

r = interest rate (decimal)

n = number of times compounded annually

t = time

First, lets change 6% into a decimal:

6% -> $\frac{6}{100}$ -> 0.06

Next, plug the values into the equation:

$A=15,000(1+\frac{0.06}{1})^{1(8)}$

$A=23,907.72$

The balance after 8 years will be $23,907.72