Question

Correct answers only please!

To the nearest cent, how much interest will she earn in 2 years?

Use the formula B = p(1 + r)t, where B is the balance (final amount), p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years.

Answer 1

A = $ 60.50

A = P + I where

P (principal) = $ 50.00

I (interest) = $ 10.50

Explanation:

A = P(1 + r/n)^nt

Where:

A = Accrued Amount (principal + interest)

P = Principal Amount

I = Interest Amount

R = Annual Nominal Interest Rate in percent

r = Annual Nominal Interest Rate as a decimal

r = R/100

t = Time Involved in years, 0.5 years is calculated as 6 months, etc.

n = number of compounding periods per unit t; at the END of each period