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a principal of $38000 is invested at 4.5% interest, compounded annually. how much will the investment be after 14 years ?
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The future value formula
f = p * (1 + r) ^ n
f is the future value
p is the present value (one-time original deposit)
r is the interest rate per time period as a decimal number
n is the number of time periods.
In your problem:
p = 38000
f = what you want to find
r = 4.5% = 0.045 annually
n = 14 annual periods
Formula becomes f = = = 70373.91 dollars. ANSWER
Solved.
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To see many other similar solved problems on compounded interest accounts, look into the lesson
- Compound interest percentage problems
in this site.
