Question

Salvador inherited $20,000 and he plans to invest it into a savings account that earns 6% interest compounded annually. Assuming he makes no additional deposits or withdrawals, what will be the total value of Salvador's account after 10 years?

Answer 1

Answer:

Step-by-step explanation:

initial value(1+ percent of interest in decimal form)^(years)

20,000(1.06)^10

= $35816.95393

Answer 2

The $35816 will be the total value of Salvador's account after 10 years.

What is compound interest?

It is defined as the interest on the principal value or deposit and the interest which is gained on the principal value in the previous year.

We can calculate the compound interest using the below formula:

$\rm A = P(1+r)^t$

Where A = Final amount

           P = Principal amount

           r  = annual rate of interest

           t = How long the money is deposited or borrowed (in years)          

We have:  P = $20,000

                 r = 6% ⇒ 0.06

                 t = 10 years

Putting the above values in the formula, we get:

$\rm A = 20000(1+0.06)^1^0$

$\rm A = 20000(1.06)^1^0\\\\\rm A = 20000\times 1.7908\\\\\rm A = \ \ 35816$

Thus, the $35816 will be the total value of Salvador's account after 10 years.

Learn more about the compound interest here :

brainly.com/question/26457073