Question

19. Heather invests $4,900 in an account with a 3.5% interest rate, making no other deposits or withdrawals. What will Heather’s account balance be after 5 years if the interest is compounded 2 times each year?

Answer 1

Answer:

$\ 5,828.28$

Step-by-step explanation:

we know that    

The compound interest formula is equal to  

$A=P(1+\frac{r}{n})^{nt}$  

where  

A is the Final Investment Value  

P is the Principal amount of money to be invested  

r is the rate of interest  in decimal

t is Number of Time Periods  

n is the number of times interest is compounded per year

in this problem we have  

$t=5\ years\\ P=\ 4,900\\ r=0.035\\n=2$  

substitute in the formula above  

$A=\ 4,900(1+\frac{0.035}{2})^{2*5}$  

$A=\ 4,900(1.0175)^{10}=\ 5,828.28$