Question

A principal of $40,000 will be invested in an account. Bank A has a 5.5% annual interest rate compounded daily. Find the amount in the account after 20 years. Show the equation used for each calculation.

Answer 1

Answer:

$116800

Step-by-step explanation:

Step one:

given

principal= $40,000

rate= 5.5%

time = 20 years

Step two:

the final amount is expressed as

$A= P(1+r)^t$

substitute

$A= 40000(1+0.055)^2^0\\\\A= 40000(1.055)^2^0\\\\A= 40000*2.92\\\\A=116800$

$116800