Answer:
Part a) The equation that represent the balance in the account after 2 years is equal to
[tex]\$1,000(1+\frac{0.013}{1})^{1*2}[/tex]
Part b) The balance in the account after 2 years is equal to [tex]\$1,026.17[/tex]
Step-by-step explanation:
we know that
The compound interest formula is equal to
[tex]A=P(1+\frac{r}{n})^{nt}[/tex]
where
A is the Final Investment Value
P is the Principal amount of money to be invested
r is the rate of interest in decimal
t is Number of Time Periods
n is the number of times interest is compounded per year
in this problem we have
[tex]t=2\ years\\ P=\$1,000\\ r=0.013\\n=1[/tex]
substitute in the formula above
[tex]A=\$1,000(1+\frac{0.013}{1})^{1*2}[/tex] ----> equation that represent the balance in the account after 2 years
[tex]A=\$1,000(1+\frac{0.013}{1})^{1*2}=\$1,026.17[/tex]