Dan's grandmother started a college savings account for him when he was born. The account earns 2.5% interest compounded annually. If you know the account's value after 15 years is A, which expression tells you the account's value after 18 years?
To find the account's value after 18 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = Final account value
P = Initial principal (the account's value after 15 years, given as A)
r = Annual interest rate (2.5% or 0.025)
n = Number of times interest is compounded per year (annually, so n = 1)
t = Number of years (18 - 15 = 3)
Substituting the given values into the formula, the expression that tells you the account's value after 18 years is:
A(1 + 0.025/1)^(1*3)
Dan's grandmother started a college savings account for him when he was born. The account earns 2.5% interest compounded annually. If you know the account's value after 15 years is A, which expression tells you the account's value after 18 years?
3. 1.0254
1.0253 • A
0.0253 • A
3 • 0.025 + A
3•1.025 + A
0.025 + 3А
To find the account's value after 18 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = Final account value
P = Initial principal (the account's value after 15 years, given as A)
r = Annual interest rate (2.5% or 0.025)
n = Number of times interest is compounded per year (annually, so n = 1)
t = Number of years (18 - 15 = 3)
Substituting the given values into the formula, the expression that tells you the account's value after 18 years is:
A(1 + 0.025/1)^(1*3)
Simplifying this expression gives:
A(1.025)^3
So, the correct expression is 1.025^3 • A