Question

The total amount of money in an account with P dollars invested in it is given by the formulaA = P + Prt.where r is the rate expressed as a decimal and t is time (in years).If $1862 is invested at 5 %, how much money will be in the account after 6 months? Round your answer to the nearest cent.

Answer 1

Given the formula:

$A=P+Prt$

You know that "A" is the amount, "P" is the number of dollars invested" r" is the rate (as a decimal), and "t" is time in years.

In this case, you can identify that:

$\begin{gathered} P=1862 \\ \\ r=\frac{5}{100}=0.05 \end{gathered}$

Remember that a percent can be converted to a Decimal Number by dividing it by 100.

Knowing that 1 year has 12 months, you can determine that 6 months is a half of a year:

$t=\frac{1}{2}$

Then, substituting values into the formula and evaluating, you get:

$\begin{gathered} A=P+Prt \\ A=1862+(1862)(0.05)(\frac{1}{2}) \end{gathered}$$\begin{gathered} A=1862+46.55 \\ A=1908.55 \end{gathered}$

Therefore, the answer is: $1908.55