Please Check my work: Use the formula for computing future value using compound interest to determine the value of an account at the end of 7 years

Question

Use the formula for computing future value using compound interest to determine the value of an account at the end of 7 years if a principal amount of $2,500 is deposited in an account at an annual interest rate of 4% and the interest is compounded daily. (Assume there are 365 days in a year.) The amount after 7 years will be ? 

 

 

 

I got 3307.78 as my answer. Did I do this correctly? 

Answer 1

Final value = initial value * (1 + interest/365) ^ total days.  Remember to express the interest rate as a decimal.

 

Final value = 2500 * (1.00010959) ^ 2555

Final value = 2500 * 1.3231 = 3307.77

We got the same answer, with some slight rounding error somewhere.