Question

1) Ethan put $700 into a Certificate of Deposit (CD) account that earns 1.8% interest each year. What will the interest of the CD account be after 6 years?

Answer 1

Answer:

The interest After 6 years is $ 79.03  

Step-by-step explanation:

Given as :

The principal amount deposited in account = $ 700

The rate interest earn = 1.8 % per year

The Time period = 6 years

From Compounded Method

Amount = Principal × $(1 +\dfrac{\textrm Rate}{100})^{\textrm Time$

Or, Amount = $ 700 × $(1 +\dfrac{\textrm 1.8}{100})^{\textrm 6$

Or, Amount =  $ 700 × $1.018^{6}$

Or, Amount =  $ 700 × 1.1129

∴ Amount = $ 779.03

Now , Interest = Amount - Principal

I.e Interest = $ 779.03 - $ 700 = $ 79.03

Hence The interest After 6 years is $ 79.03  ,  Answer

Answer 2

Answer:$75.60

Step-by-step explanation:

i=interest

i=$700×0.018×6= 75.60

(remember decimal divided by 100 so 1.8%/100=0.018)

the interest after 6 years would be $75.60