How much interest would be earned on $24,664.64 if the owner invest the full amount into an annuity in a regular compounded -interest account with the term of 4 years .
interest=24664.65(1+i)^4 -24664.65
24664.65(1+.105)^4-24664.65=12107.93
note the interest rate is 10.5% did I do this correctly
To calculate the amount of interest earned on an annuity with compound interest, you need to use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment (including interest)
P = the principal amount (initial investment)
r = annual interest rate (expressed as a decimal)
n = number of times that interest is compounded per year
t = number of years
In this case, we have:
P = $24,664.64
r = unknown
n = annually
t = 4 years
We need to solve for r.
However, we do not have enough information to determine the rate of interest in this scenario. The annual interest rate (r) needs to be provided or calculated based on additional information such as the interest rate specified by the annuity provider or the historical rates of similar investment products.