Question

You are saving money to buy an electric guitar. You deposit $1000 in an account that earns interest compounded annually. The expression 1000(1+r)^2 represents the balance after 2 years where r is the annual interest rate in decimal form. Write a polynomial in standard form.
The interest rate is 3%. What is the balance of your account after 2 years.
The guitar costs $1100. Do you have enough money in your account after 3 years?

Answer 1

Let's move like a crab, backwards some.

after 2 years?

$\bf ~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\to &\ 1000\\ r=rate\to 3\%\to \frac{3}{100}\to &0.03\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{annually, thus once} \end{array}\to &1\\ t=years\to &2 \end{cases} \\\\\\ A=1000\left(1+\frac{0.03}{1}\right)^{1\cdot 2}\implies A=1000(1.03)^2$

after 3 years?

$\bf ~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\to &\ 1000\\ r=rate\to 3\%\to \frac{3}{100}\to &0.03\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{annually, thus once} \end{array}\to &1\\ t=years\to &3 \end{cases} \\\\\\ A=1000\left(1+\frac{0.03}{1}\right)^{1\cdot 3}\implies A=1000(1.03)^3$

is that enough to pay the $1100?


now, let's write 1000(1+r)² in standard form

1000( 1² + 2r + r²)

1000(1 + 2r + r²)

1000 + 2000r + 1000r²

1000r² + 2000r + 1000   <---- standard form.