Question

You deposit $2700 in an account that pays 3% annual interest compounded weekly. How much money is in the account after 5 years?

Answer 1

Answer:

A = $3136.86

Step-by-step explanation:

Given the following data;

Principal = $2700

Interest rate = 3% = 3/100 = 0.03

Number of times = 52

Time = 5 years

To find the future value, we would use the compound interest formula;

$A = P(1 + \frac{r}{n})^{nt}$

Where;

A is the future value.

P is the principal or starting amount.

r is annual interest rate.

n is the number of times the interest is compounded in a year.

t is the number of years for the compound interest.

Substituting into the equation, we have;

$A = 2700(1 + \frac{0.03}{52})^{52*5}$

$A = 2700(1 + 0.0005769)^{260}$

$A = 2700(1.0005769)^{260}$

$A = 2700(1.1618)$

A = $3136.86