SOLUTION: 1.A certain bank pays 1% compound interest for their savings account holders. If Nick deposits $10000 in that bank. (refer page 707 in the text book) (40 points) Formula = A= P (1
Algebra.Com
Question 251431: 1.A certain bank pays 1% compound interest for their savings account holders. If Nick deposits $10000 in that bank. (refer page 707 in the text book) (40 points) Formula = A= P (1 + r)^t
a. Estimate how much money will be in his account after 25 years using your formula. Assume there will not be any deposits or withdrawals during that 25 year period.
b. Estimate how long it will take to double the total amount (i. e. the total is $20000) in Nick’s account.
c.Estimate the total amount in Nick’s account after one year.
Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
A certain bank pays 1% compound interest for their savings account holders. If Nick deposits $10000 in that bank. (refer page 707 in the text book) (40 points) Formula = A= P (1 + r)^t
a. Estimate how much money will be in his account after 25 years using your formula. Assume there will not be any deposits or withdrawals during that 25 year period.
A(25) = 10,000(1+0.01)^25
A(25) = 10,000(1.01)^25
A(25) = 10,000*1.2824
A(25) = 12,824.00
=======================
b. Estimate how long it will take to double the total amount (i. e. the total is $20000) in Nick’s account.
20,000 = 10,000(1.01)^t
2 = 1.01^t
t*log(1.01) = log(2)
t = log(2)/log(1.01)
t = 69.66 years
==========================
c.Estimate the total amount in Nick’s account after one year.
A(1) = 10,000(1.01)^1
A(1) = 10,100
=====================
Cheers,
Stan H.
RELATED QUESTIONS
Steve's bank pays an annual interest rate of 2.8 percent on a savings account. The... (answered by ewatrrr)
Assume that on January 1st of this year you deposited $1,000 into a savings account that... (answered by checkley77)
two banks pay simple interest on short-term deposits. bank a pays 5% p.a. over 3 years,... (answered by MathLover1)
An amount of $1,000 is deposited into a bank account that pays 4% interest compounded... (answered by mananth)
Sue has $400 in her savings account. If the bank pays her 6 1/2% interest, how much... (answered by checkley77)
Elsa placed some money in a savings account for two years with a 6% interest rate. If the (answered by Boreal,MathTherapy)
A bank features a savings account that has an annual percentage rate of 4.3 % with... (answered by ikleyn)
A bank features a savings account that has an annual percentage rate of 2.7 % with... (answered by ikleyn)
A bank features a savings account that has an annual percentage rate of 3.6 % with... (answered by ikleyn)