Question

1. Jeremy has $12000 cash to invest in the bank compounded at 4% interest annually.

Answer 1

Answer:

$A(x) = 12000(1.04)^x$

Step-by-step explanation:

Compound interest:

The compound interest formula is given by:

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

Where A(t) is the amount of money after t years, P is the principal(the initial sum of money), r is the interest rate(as a decimal value), n is the number of times that interest is compounded per year and t is the time in years for which the money is invested or borrowed.

$12000 cash

This means that $P = 12000$

Compounded at 4% interest annually.

This means that $r = 0.04, n = 1$

What equation will calculate the value in x years?

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

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

$A(x) = 12000(1 + 0.04)^x$

$A(x) = 12000(1.04)^x$