Question

A principal of $5,350 is placed in an account that earns 3.5% interest. If the interest is compounded annually, how much money will be in the account at the end of 4 years? a. $5,760.06 b. $5,537.25 c. $6,099.00 d. $6,139.25

Answer 1

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  

$t=4\ years\\ P=\ 5,350\\ r=0.035\\n=1$  

substitute in the formula above  

$A=5,350(1+\frac{0.035}{1})^{1*4}=\ 6,139.25$

therefore

the answer is the option D

$\ 6,139.25$

Answer 2

The Answer is D: 6,139.25 dollars