Question

How much would Keith have in his account after three years if he started with $200 and earns 2 percent interest, compounding annually? $12.24 $200 $400 $212.24

Answer 1

Answer:

Option D.

Explanation:

Formula for amount after compound interest:

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

where,

P is principal

r is rate of interest.

n is number of times interest compounded in one period.

t is number of periods.

Given information:

P = $200

r = 2%=0.02

t = 3

n= 1

Substitute these values in the above formula.

$A=200(1+\frac{0.02}{1})^{1(3)}$

$A=200(1.02)^{3}$

$A=212.2416$

$A\approx 212.24$

Keith have $212.24 in his account after three years.

Therefore, the correct option is D.

Answer 2

212.24 would be your answer.  12.24 is just how much he makes off interest, not the total amount.  200 is what he started with.  And 400 is just way to high of a number.