ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Jay’den earned $475 from mowing lawns last summer. He deposited this money in an account that pays an interest rate of 3.8% compounded annually. Jay’den wants to know his balance after 15 years?What does $475 represent?
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Principal or initial value, P
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Rate of interest, r
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Number of times interest is compounded, n
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Time, t
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Explanation:
Detailed explanation-1: -The balance after 15 year is $831.25 .
Detailed explanation-2: -Now Compound interest = A-P ⇒ Compound interest = Rs. 15972-Rs. 12000 = Rs. 3972.
Detailed explanation-3: -= 15 years. Was this answer helpful?
Detailed explanation-4: -Therefore, the number of years it will take to double the money at 5% per annum when compounded annually is 12.5 years.
Detailed explanation-5: -The compound interest formula is A = P ( 1 + r n ) n t . Type in the principal amount and interest rate (values round to the nearest integer). Start, stop, and adjust the time in years to see the monetary value change over time.
There is 1 question to complete.