$275 at 7.5% for 4 years?
I am cassandras mom very confused by the way she is being taught this. I took 275 X 7.5% X 4 = 82.50 + 275 =357.50. That's the answer I got. She has an answer of 341.62. So whos right?
Here's the way I was taught about 65 years ago.
Interest = principle * rate * time
275 * 0.075 * 4 = 82.50
She'll pay/earn $82.50 in interest.
82.50 + 275 = 357.50
I agree with your answer.
Guys....I got 82.5 I think my brain is just out of braincells ✌️💀
Linda/Cassandra -- please use the same name for your posts.
We've helped you with several problems. Now it's your turn.
I'll be glad to check your answer.
Thank You so much. I will have to ask her teacher about the way she is being taught with adding the interest each year. Thank You again.
You're very welcome, Linda.
I agree with Ms Sue's & Linda's answer of
357.50
The teacher has her adding the interest each year separately. I don't know.
To calculate the total amount of money you will have after 4 years with an initial amount of $275 at an interest rate of 7.5%, you can use the formula for compound interest.
The formula for compound interest is: A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment/loan, including interest
P = the principal investment amount (in this case, $275)
r = the annual interest rate (expressed as a decimal)
n = the number of times that interest is compounded per year (typically, it's compounded annually, so n = 1)
t = the number of years the money is invested for
In this case, let's plug in the given values into the formula:
A = 275(1 + 0.075/1)^(1*4)
First, divide the interest rate (7.5%) by the number of times the interest is compounded per year (1) to get the decimal form of the interest rate (0.075).
A = 275(1 + 0.075)^4
Next, raise the result to the power of the number of years (4).
A = 275(1.075)^4
Now, calculate 1.075 raised to the power of 4.
A = 275(1.31643)
Finally, multiply $275 by 1.31643 to get the total amount of money after 4 years.
A = $361.52
Therefore, after 4 years at an interest rate of 7.5%, $275 will grow to approximately $361.52.