Ay-Jiuan deposits $700 into a savings account that pays %2 interest compounded annually. If Ay-Jiuan does not make any deposits or withdrawals for 4 years, how much money will be in her account? Round to the nearest cent.
A. )714.00
B. $742.85
C. $756.00
D. $757.70
Using the formula A = P(1+r/n)^(nt), where A is the amount in the account, P is the principal (initial deposit), r is the interest rate (as a decimal), n is the number of times the interest is compounded in a year, and t is the time period (in years), we can solve for A.
In this case, we have:
A = 700(1+0.02/1)^(1*4)
A = 700(1.02)^4
A = 700(1.082432)
A = 758.70
Rounding to the nearest cent, the answer is D. $757.70.