Brody deposited $500 into an account that
earns 4.2% interest compounded annually. He
makes no additional deposits and no withdrawals.
Approximately how much interest will the account
have earned after 7 years?
A $167
B $420
C $542
D $665
I think the answer is D. But can someone tell me how to check my answer with work. I don't want to use a calculator.
this is so dumb you always put wrong answers. Only put it if you are certain that it is right. People are copying you guys because they think you are right and they fail because of you guys putting wrong answers.
shush
167$, A
It is A
Thank you so much! :)
wow
How do you calculate it
To calculate the interest earned on an account, we can use the formula:
A = P(1 + r/n)^(nt)
Where:
A is the future value of the investment/loan, including interest
P is the principal investment amount (initial deposit)
r is the annual interest rate (expressed as a decimal)
n is the number of times that interest is compounded per year
t is the number of years the money is invested/borrowed for
In this case, Brody deposited $500 into an account that earns 4.2% interest compounded annually, and the money is invested for 7 years.
Let's plug in the values into the formula:
A = 500(1 + 0.042/1)^(1*7)
Simplifying the equation:
A = 500(1.042)^7
Now we can calculate the value inside the parentheses first:
1.042^7 ≈ 1.34392
Now substitute this value back into the equation:
A ≈ 500 * 1.34392
A ≈ 671.96
The future value of the investment after 7 years is approximately $671.96. To find the interest earned, we subtract the initial deposit from the future value:
Interest earned = $671.96 - $500
Interest earned = $171.96
Thus, the account would have earned approximately $171.96 in interest after 7 years.
Since none of the answer choices match exactly, it seems that option D ($665) is the closest answer. However, it is not the exact amount of interest earned.
you are going to need a calculator of some kind, unless you want to evaluate
500(1.042^7) - 500
by hand
By the way, D is the amount in the account, but it is not the answer to the question.