SOLUTION: A customer deposits $500 in an account that pays 4% annual interest. What is the balance after 3 years if the interest is compounded annually?

Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: A customer deposits $500 in an account that pays 4% annual interest. What is the balance after 3 years if the interest is compounded annually?       Log On

Ad: Over 600 Algebra Word Problems at edhelper.com


    

Question 952263: A customer deposits $500 in an account that pays 4% annual interest. What is the balance after 3 years if the interest is compounded annually?
Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
A customer deposits $500 in an account that pays 4% annual interest. What is the balance after 3 years if the interest is compounded annually?
--------------------
A(t) = P(1+(r/n))^(nt)
-----
A(3) = 500(1+0.04/1))^(1*3)
----
A(3) = 500(1.04)^3
-------
A(3) = $562.43
------------------
Cheers,
Stan H.
----------