Problema Solution
If Serena puts $1,000 in a savings account that pays 2% interest compounded annually, how much money will she have in the account after 10 years?
Answer provided by our tutors
we use the following formula for compound interest:
T = P(1 + r/n)^nt
where 'T' is total accumulated, 'P' is principal investment, 'r' is rate, 'n' is number of times interest is accrued per year and 't' is the number of years the savings is left alone
T = 1000(1 + 0.02/1)^10 = 1218.99
the account will have $1,218.99 after 10 years