What is the final amount if you earn 5% interest compounded annually on $31,000 for 29 years
final amount=31.000*(1+interes/100)^29
Becouse 5% = 5/100= 0.05
Final amount=31,000*(1+0.05)^29
=31,000*1.05^29
=31,000*4.116136=127600.216
it is desired that an investment grow to $5000 OVER THREE YEARS at a simple annual interest rate of 6% find the amount that must be invested now.
To calculate the final amount after earning 5% interest compounded annually, you can use the formula for compound interest:
A = P(1+r)^n
Where:
A = Final amount
P = Principal amount (initial investment)
r = Interest rate (in decimal form)
n = Number of compounding periods
In this case, the principal amount (P) is $31,000, the interest rate (r) is 5% (or 0.05 in decimal form), and the number of compounding periods (n) is 29 years.
Step 1: Convert the interest rate to decimal form: 5% = 0.05
Step 2: Substitute the values into the formula:
A = 31,000(1 + 0.05)^29
Now, let's calculate the final amount using this formula.
A = 31,000(1.05)^29
A ≈ 31,000(2.703){
A ≈ $83,793.08
Therefore, after 29 years, the final amount would be approximately $83,793.08.