The value of this account in 10 years is given by the formula:
FV = P*(1+r)^t
where FV is the future value in the account after 10 years(to be calculated)
P is the principal invested at the beginning
r is the interest rate and
t is the time horizon in years
Given, Invested Amount (P) = 20,000
Interest rate (r) = 5.5% = 0.055
Time horizon (t) = 10 years = 10
Substituting the formula, FV = 20,000*(1+0.055)^10 = 20,000*1.055^10 = 20,000*1.708144458 = 34,162.89
The value of this account after 10 years =$34,162.89 (Rounded to the nearest cent)
