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December 19, 2014

December 19, 2014

Posted by **michelle** on Wednesday, June 8, 2011 at 10:00pm.

her account. The account pays an

interest rate of 6.3%. The formula to

calculate the balance in her account

is B =A(1+ r)n+1- A, where

r

A is the amount invested per year,

r is the interest rate, and n is the

number of years investing

- math - typo? -
**MathMate**, Wednesday, June 8, 2011 at 10:43pmNot sure what your question is, but the formula does not look right. You may want to check the post for typos.

If someone invests $A at the beginning of the year, at the end of one year, the balance is $A plus the interest, which is $Ar. So the balance is A(1+r).

For two years, it would be the sum of two investments,

A(1+r)²+A(1+r)

for n years, it would then be:

A[(1+r)+(1+r)²+(1+r)³...+(1+r)^n]

which is algebraically equal to

A[(1+r)^(n+1)-1)]/r - A

=A[((1+r)^(n+1)-1)/r - 1]

slightly different from yours. Your formula seems to miss out the "/r".

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