SOLUTION: The amount of money, A, accrued at the end of n years when a certain amount, P, is invested at a
compound annual rate, r, is given by A=P(1+r) n . If a person invests $110 in an a
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Question 1004873: The amount of money, A, accrued at the end of n years when a certain amount, P, is invested at a
compound annual rate, r, is given by A=P(1+r) n . If a person invests $110 in an account that pays 5% interest compounded annually, find the balance after 15 years.
Found 3 solutions by fractalier, addingup, Cromlix:
Answer by fractalier(6550) (Show Source): You can put this solution on YOUR website!
The compound interest formula is given by
A=P(1+r)^n
Now just plug the facts in and get
A = 110(1 + .05)^15 = 110(2.079) = $228.68
Answer by addingup(3677) (Show Source): You can put this solution on YOUR website!
Future Value= Present Value(1+rate/number of periods)^time
In this problem, because it's compounded annually, the number of periods is 1. Since any number divided by 1 equals the number:
FV= 110(1+.05/1)^15= 110(1+.05)^15= 110(1.05)^15= 110(2.08)= 228.80 is your answer.
Answer by Cromlix(4381) (Show Source): You can put this solution on YOUR website!
Hi there,
Your formula should be:-
A=P(1+r)^n
P = $110
r = 5% = 5/100 = 0.05
n = 15
A = $110(1 + 0.05)^15
A = $110(1.05)^15
A = $228.68
Hope this helps :-)
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