Question

Zene deposited $50 in a savings account earning 5% interest, compounded annually. To thenearest cent, how much will he have in 3 years?

Answer 1

Answer:

$\ 57.88$  

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  

$t=3\ years\\ P=\ 50\\ r=5\%=5/100=0.05\\n=1$  

substitute in the formula above

$A=50(1+\frac{0.05}{1})^{1*3}$  

$A=50(1.05)^{3}$  

$A=\ 57.88$