An initial amount of $800 is invested in a compound savings account with an annual interest rate of 4.5%. Using the formula A+P(1+r)^t what is the balance after
Mathematics
skylarboyd13
Question
An initial amount of $800 is invested in a compound savings account with an annual interest rate of 4.5%. Using the formula A+P(1+r)^t what is the balance after five years?
$836.00
$873.62
$980.00
$996.95
$836.00
$873.62
$980.00
$996.95
2 Answer

1. User Answers Aliwohaish12
800×(1+0.045)^(5)
=996.95
....... 
2. User Answers JackelineCasarez
Answer:
The amount after 5 years becomes $996.95 .
Stepbystep explanation:
Formula
[tex]Amount = P(1+r)^{t}[/tex]
Where P is the principle , r is the rate of interest in the decimal form and t is the time in years .
As given
An initial amount of $800 is invested in a compound savings account with an annual interest rate of 4.5% for 5 years .
P = $800
4.5% is written in the decimal form
[tex]= \frac{4.5}{100}[/tex]
= 0.045
t = 5 years
Put all the values in the formula
[tex]Amount = 800(1+0.045)^{5}[/tex]
[tex]Amount = 800(1.045)^{5}[/tex]
[tex]Amount = 800\times 1.24618[/tex]
Amount = $996.95 (Approx)
Therefore the amount after 5 years becomes $996.95 .