contestada

Mr. and Mrs. Sanchez want to invest money for their
child's college education. They have decided to invest
$2000 initially. If the investment is in an account that
earns 8% annual interest, compounded yearly for 10
years, how much will their investment be worth at the
end of the 10th year? (Hint: $2000 is ao, think about a
as the value of the account at end of the 1st year.)

Respuesta :

samuelonum1

The total amount accrued, principal plus interest, with compound interest on a principal of $2,000.00 at a rate of 8% per year compounded 1 times per year over 10 years is $4,317.85.

Given Data

Initial Amount = $2000

Annual interest rate = 8%

Time = 10 years

A = P + I where

P (principal) = $2,000.00

I (interest) = $2,317.85

Calculation Steps:

First, convert R as a percent to r as a decimal

r = R/100

r = 8/100

r = 0.08 rate per year,

Then solve the equation for A

A = P(1 + r/n)^nt

A = 2,000.00(1 + 0.08/1)(1)(10)

A = 2,000.00(1 + 0.08)(10)

A = $4,317.85

Learn more about compound interest here:

https://brainly.com/question/24924853

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