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Essential Mathematics

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Actually calculate the final amount on $1,000 compounded annually at 6% per year for 4 years?

  • Essential Mathematics -

    At 6%, the total amount after one year is 6%+100%=106% or 1.06.

    Beginning of first year
    $1000
    End of first year
    $1000*1.06=$1060
    End of second year:
    $1000*1.06^2
    $1060*1.06=$1123.60
    End of third year:
    $1000*1.06^3
    =$1123.6*1.06=$1191.02

    Can you take it from here?

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