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math

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a person deposits five hundred dollars in a savings account that pays 5% annual interest that is compounded yearly. At the end of ten years, how much money will be in the savings account?

  • math -

    P = Po(1+r)^n.

    Po = $500. = Initial investment.

    r = (5%/100%) = 0.05 = APR expressed as a decimal.

    N = 1Comp./yr * 10yrs = 10 Compounding periods.

    Plug the above values into the given Eq and get:

    P = $814.45.

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