Question

Elena's aunt bought her $150 savings bond when she was born. When Elena is 20 years old, the bond will have earned 105% in interest. How much will the bond be worth when Elena is 20 years old?

Answer 1

$307.5

Explanation:

The bond is bought when Elena was born and its value is $150

Starting balance = $150

Once Elena turns 20 the bond has already earned 105% interest.

To calculate that out the equation is

20 year total = starting balance + (starting balance x interest rate) /100

`T = 150 + (150 X 105)/(100)`

That means after 20 years the bond will be $307.5.