Question

Find the balance in the account. $2,400 principal earning 2%, compounded annually, after 7 years $307,200.00 $17,136.00 $2,736.00 $2,756.85

Answer 1

Answer:

$2,756.85$  

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  

$t=7\ years\\ P=\ 2,400\\ r=2\%=2/100=0.02\\n=1$  

substitute in the formula above  

$A=2,400(1+\frac{0.02}{1})^{1*7}$  

$A=2,400(1.02)^{7}$  

$A=2,756.85$