you invest $750 in a account thatg rearns 4.5%, compounded annually. Find the balance of the account after 2 years.Round your answer to the nearest cent.
To find the balance of the account after 2 years with compound interest, you can use the following formula:
A = P(1 + r/n)^(nt)
Where:
A = the balance or future value of the investment
P = the principal or initial amount invested ($750 in this case)
r = the annual interest rate (4.5% or 0.045 as a decimal)
n = the number of times the interest is compounded per year (annually in this case)
t = the number of years the investment is held (2 years in this case)
Plugging in the given values into the formula, we get:
A = 750(1 + 0.045/1)^(1*2)
Simplifying the equation further:
A = 750(1 + 0.045)^2
Calculating the exponents first:
A = 750(1.045)^2
A = 750(1.091025)
A ≈ 818.27
Therefore, the balance of the account after 2 years, rounded to the nearest cent, is approximately $818.27.