Mark deposits $2000 into an account that pays an interest rate of 3.5% Compounded annually. He doesn’t add or remove money from his account for 4 years. How much money will Mark have in 4 years?
To calculate the future value of the account after 4 years, we can use the formula for compound interest:
FV = P(1 + r)^n
Where:
FV = Future Value
P = Initial deposit ($2000)
r = Annual interest rate (3.5% or 0.035)
n = Number of compounding periods (4 years)
Plugging in the values, we get:
FV = 2000(1 + 0.035)^4
FV = 2000(1.035)^4
FV = 2000(1.150701)
FV = $2301.40
Therefore, Mark will have $2301.40 in his account after 4 years.