Question

1.How much will $5,000 accumulate in 5 years if it earns 6% per annum for the first 3 years and then 8% per annum for the next 2 years?

Answer 1

Answer:  Amount after 5 years become $5937.60.

Step-by-step explanation:

Since we have given that

Principal amount = $5000

Time period = 5 years

Rate of interest for 3 years = 6%

Rate of interest for 2 years = 8%

so, Amount becomes

$Amount=5000(1+\dfrac{6}{1000})^3(1+\dfrac{8}{100})^2\\\\Amount=5000(1+0.006)^3(1+0.08)^2\\\\Amount=5000(1.006)^3(1.08)^2\\\\Amount=\ 5937.60$

Hence, Amount after 5 years become $5937.60.