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Paha777 [63]
3 years ago
6

$2,500 for 25 years at 2.75% annual simple interest

Mathematics
1 answer:
xxMikexx [17]3 years ago
3 0

Answer:

4,218.75

Step-by-step explanation:

Lets say that P is your starting principal (spelled -pal and not -ple, because Your Money is Your Pal), r is the interest rate (expressed as a decimal), and Y is the number of years you invest. Then your future value will be:

P (1 + rY) (Simple Interest)

P (1 + r)Y (Annually Compounded Interest)

Note the two formulas give the same answer for one year. After that, compound interest takes off.

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