# SOLUTION: If \$8,000.00 is deposited in a bank that compounds interest anually at 5%, then what is the interest paid at the end of the second year?

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 Click here to see ALL problems on percentage Question 201735: If \$8,000.00 is deposited in a bank that compounds interest anually at 5%, then what is the interest paid at the end of the second year?Answer by stanbon(57347)   (Show Source): You can put this solution on YOUR website!If \$8,000.00 is deposited in a bank that compounds interest anually at 5%, then what is the interest paid at the end of the second year? -------- A(t) = P(1+(r/n))^(nt) A(2) = 8000(1+(0.05)/2))^(1*2) A(2) = 8000(1+0.025)^2 A(2) = \$8405.00 ---------------------- Amount of interest earned is \$405.00 ============================================== Cheers, Stan H.