Question

A 50,000 investment earns 18 percent annually. If b represents the balance and t represents the number of years

Answer 1

Answer: B = 50,000 * 1.18^t

Explanation:

This requires the use of the Future Value formula.

Future value = Amount invested + ( 1 + rate) ^ number of years invested

Future value = B in this scenario.

t = number of years.

When putting in figures therefore, the formula becomes:

B = 50,000 * ( 1 + 18%) ^ t

B = 50,000 * 1.18^t