Answer:
Step-by-step explanation:To calculate the compound interest after 4 years for an investment of $5341 at an annual interest rate of 5% compounded annually, you can use the formula for compound interest:
\[C = P \times \left(1 + \frac{r}{n}\right)^{nt} - P\]
Where:
- \(C\) = Compound interest
- \(P\) = Principal amount (initial investment)
- \(r\) = Annual interest rate (in decimal form)
- \(n\) = Number of compounding periods per year
- \(t\) = Number of years
Given:
- Principal (\(P\)) = $5341
- Annual interest rate (\(r\)) = 5% or 0.05 (in decimal form)
- Compounding periods per year (\(n\)) = 1 (annually)
- Time (\(t\)) = 4 years
Plug in the values into the formula:
\[C = 5341 \times \left(1 + \frac{0.05}{1}\right)^{1 \times 4} - 5341\]
Calculate the exponent and compute the compound interest (\(C\)).
The compound interest after 4 years will be $________ (rounded to the nearest cent).