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podryga [215]
3 years ago
6

Assume you are bequeathed $500 by a long-lost cousin. You decide that, for the next year, you will put all that money in the ban

k until you decide what to do with it. The bank is currently paying an interest rate of 4%.
a. At the year's end you will have $______
b. At the year's end your savings will have increased by $________
Business
1 answer:
lukranit [14]3 years ago
5 0

Answer:

Results are below.

Explanation:

Giving the following information:

Initial investment (PV)= $500

Number of periods (n)= 1 year

Interest rate (i)= 4% = 0.04

<u>To calculate the future value after one year, we need to use the following formula:</u>

FV= PV*(1+i)^n

FV= 500*(1.04^1)

FV= $520

The savings increased by $20.

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