Question

Suppose Mai places $3500 in an account that pays 19% interest compounded each year.

Assume that no withdrawals are made from the account.
Follow the instructions below. Do not do any rounding.
(a) Find the amount in the account at the end of 1 year.
S
(b) Find the amount in the account at the end of 2 years.

Answer 1

a.$4165

b.$4956.35

Explanation:

a)19% × 3500 = 665.

3500+665 =4165

b)19% × 4165 = 791.35

4165+791.35= 4956.35