Question

A principle of $300 was deposited in a savings account that pays 3.5 interest compoundedyearly. Find the balance after 5 years. Your answer should be numerical only.

Answer 1

Explanation:

The balance after t years can be calculated using the following equation:

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

Where P is the principal amount and r is the rate of interest per year.

So, replacing P by $300, r by 3.5%, and t by 5, we get:

$\begin{gathered} A=300(1+0.035)^5 \\ A=300(1.1877) \\ A=356.3059 \end{gathered}$

So, the balance after 5 years is $356,3059

Answer: $356.3059