Answered

Westonci.ca connects you with experts who provide insightful answers to your questions. Join us today and start learning! Discover comprehensive solutions to your questions from a wide network of experts on our user-friendly platform. Connect with a community of professionals ready to provide precise solutions to your questions quickly and accurately.

How much would $500 invested at 7% interest compounded annually be worth after 4 years? Round your answer to the nearest cent

Sagot :

AL2006
If 7% interest is compounded annually, then the value of the $500
after 'Y' years in the future is
                                                         $500 (1.07)^to the 'y' power .

For this exercise, it's    $500 (1.07)⁴ =  $ 655.40 .     
JeanaShupp

Answer: $655.40

Step-by-step explanation:

Given : Principal amount = $500

The rate of interest  compounded annually  =7%=0.07

Time = 4 years

We know that compound amount after n years is given by :

[tex]A=P(1+r)^n[/tex]

Thus for the given situation , the compounded  amount after 4 years will be :-

[tex]\\\Rightarrow\ A=500(1+0.07)^4\\\Rightarrow\ A=500(1.07)^4\\\Rightarrow\ A=\$655.398005\approx\$655.40........\text{to the nearest cent.}[/tex]

Thank you for visiting our platform. We hope you found the answers you were looking for. Come back anytime you need more information. Thanks for stopping by. We strive to provide the best answers for all your questions. See you again soon. Westonci.ca is your trusted source for answers. Visit us again to find more information on diverse topics.