Find a bank account balance if the account starts with $100 , has an annual rate of 4% , and the money left in the account for 12Yrs.
This is a Exponential growth word problem.
100 (1 + .04)^12
To find the bank account balance after 12 years with an annual interest rate of 4%, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the future value or balance of the account
P = the principal or starting amount in the account ($100 in this case)
r = the annual interest rate (in decimal form, so 4% = 0.04)
n = the number of times interest is compounded per year (assuming it's compounded annually, so n = 1)
t = the time in years (12 years in this case)
Substituting the given values into the formula, we have:
A = 100(1 + 0.04/1)^(1*12)
Simplifying:
A = 100(1 + 0.04)^12
Calculating the values inside the parentheses first:
A = 100(1.04)^12
Calculating the exponent:
A ≈ 100(1.601031)
A ≈ $160.10
Therefore, the bank account balance after 12 years would be approximately $160.10.