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math

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If $7,800 is deposited into an account paying 6% interest compounded annually (at the end of each year), how much money is in the account after 2 years?

  • math -

    $7,800 * 0.06 = $468
    $7,800 + 468 = $8,268

    $8,268 * 0.06 = $496.08
    $8,268 + 496.08 = ?

  • math -

    X = 7800 (1 + .06)(1 +.06)

    X = future value = Current value times (1 + interest rate) to the power of how many times the interest is calculated.

    This should help you calculate similar problems too.

    I hope this helps. Thanks for asking.

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