Question

A principal of $3100 is invested at 5.5% interest, compounded annually. How much will the investment be worth after 7 years?

Answer 1

Answer:

$4501.51

Step-by-step explanation:

Because you're compounding annually, which is only once per year, you can use a simple formula:

$A(t)=P(1+r)^{t}$

Filling in our info gives us

$A(t)=3100(1+.055)^7$

Do the adding inside the parenthesis and then raise 1.055 to the 7th power to get

A(t)= 3100(1.454679161)

A(t)= $4509.51