Candace S. answered • 03/02/16
Tutor
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A day without Math is like a day without sunshine!
Hi Nikole,
parents opened an account with $5,000 18 years ago at a 1.6% interest rate,compounded annually. how much money is in the account now?
The compound interest formula is
A=P[1 +r/n]nt
P=5000
t=18 yrs
r=1.6% which in a decimal is .016
n=1 since it is compounded annually
Substitute in the values
A=5000[1+.016]18
A=5000[1.016]18 use calculator
A=P[1 +r/n]nt
P=5000
t=18 yrs
r=1.6% which in a decimal is .016
n=1 since it is compounded annually
Substitute in the values
A=5000[1+.016]18
A=5000[1.016]18 use calculator
A=6653.60
ANSWER: the amount after 18 years is $6,653.60.
We're finished!
