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mat 115

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If $1,000.00 is deposited into an account paying 3% interest compounded annually (at the end of each year), how much money is in the account after 5 years? (Round to the nearest cent.) I cannot remeber the formula for this problem can you help

  • mat 115 -

    Amount = principal( 1+i)^n
    where i is the interest rate per period expressed as a decimal, and n is the number of interest periods

    for yours i = .03
    n = 5

    Amount = 1000(1.03)^5
    = ....

  • mat 115 -

    ahhh, just read your question again.
    I think your are saying that $1000 is deposited EACH year for 5 years

    Amount = deposit [1.03^5 - 1]/.03
    = 5309.14

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