SOLUTION: The formula for calculating the amount of money returned for an initial deposit into a bank account or CD (certificate of deposit) is given by {{{P = A(1+r/n)^(n*t)}}} A is t

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Question 193045: The formula for calculating the amount of money returned for an initial deposit into a bank account or CD (certificate of deposit) is given by

A is the amount of the return.
P is the principal amount initially deposited.
r is the annual interest rate (expressed as a decimal).
n is the number of compound periods in one year.
t is the number of years.
Carry all calculations to six decimals on each intermediate step, then round the final answer to the nearest cent.
Suppose you deposit $3,000 for 9 years at a rate of 6%.
a) Calculate the return (A) if the bank compounds annually (n = 1). Round your answer to the hundredth's place.
Answer by Edwin McCravy(20060)   (Show Source): You can put this solution on YOUR website!




Take out the  and put 3000 in its place:



Take out the  and put 0.06 in its place:



Take out the  and put 9 in its place:



Write  as

a) Calculate the return (A) if the bank compounds annually (n = 1). Round your answer to the hundredth's place.



Take out the n and put  " *1 " in its place



We can erase the 1's





Raise 1.06 to the 9th power on your calculator
and get 1.689479, rounded to 6 decimal places.

Take out the  and put " 1.689479 " in its place 



Multiply 3000 by 1.689479 and you get



Rounding to the nearest cent:

P = $5968.44

Edwin
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