Question

Would you use the equation A(t) = a(1 + r)^t or A = Pe^rt to solve home much will be in your account in 5 years if you deposit $2000 and pays an annual interest of 4%?

Answer 1

Given:

$a=\text{ \ 2000 ; r=4\% ; }t=5$$\begin{gathered} A=a(1+r)^t \\ A=2000(1+0.04)^5 \\ A=2000(1.04)^5 \\ A=2433.31 \end{gathered}$

Total money in the account after 5 years is $2433.31