Question

A bank representative studies compound interest so she can better serve customers. She analyzes what happens when 2,000 earns several ways at a rate of 4% for 3 years

Answer 1

Final amount = 25,407.4

Explanation:

A = P ( 1 +
`(r)/(t) )n^{}`

A = final amount

P = initial principal balance

r = interest rate

t = number of times interest applied per time period

Here P = 2000

r = 4 %

n = 3 years

A = 2000( 1 +
`(4)/(3)` )³

= 2000(
`(7)/(3)` )³

= 2000 ×
`(343)/(27)`

= 25,407 .4

Final amount = 25,407.4