SOLUTION: one thousand dollars is invested at 12% interest compounded annually. determine how much the investment is after 2 years

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Question 73442This question is from textbook algebra and trigonometry structure and method
: one thousand dollars is invested at 12% interest compounded annually. determine how much the investment is after 2 years This question is from textbook algebra and trigonometry structure and method

Answer by jim_thompson5910(35256) About Me  (Show Source):
You can put this solution on YOUR website!
Use the formula:
A=P%281%2Br%2Fn%29%5E%28nt%29Where A is the return, P is the invested amount, r is the interest rate, n is the compound frequency (since its annually n=1) and t is the time t=2 years
A=1000%281%2B.12%29%5E%282%29
A=1000%281.12%29%5E%282%29
A=1000%281.2544%29
A=1254.4
So after two years you'll have $1,254.4. This seems like a lot but doing more of these problems will help you grasp them better.