Question

Debbie has $70 in a savings account that earns 5% interest, compounded annually.

To the nearest cent, how much will she have in 2 years?

Answer 1

$14

Explanation:

70*.05 = 3.5

3.5*2 = 7 <— multiplying by 2 because it’s compounded

7*2 = 14 <— multiplying by 2 because it’s in 2 years