Question

1. Dominic Joseph deposits $5,000 in a new savings account at his local bank. The account pays 5.5 percent interest compounded annually. At the end of 6 years, how much will Dominic’s account be worth?

Answer 1

Answer:

The future value is $6,894.21

Explanation:

Giving the following information:

Dominic Joseph deposits $5,000 in a new savings account. The account pays 5.5 percent interest compounded annually.

To calculate the future value, we need to use the following formula:

FV= PV*(1+i)^n

PV= 5,000

i= 0.055

n=6

FV= 5,000*(1.055)^6= $6,894.21