Question

Suppose that $9000 is placed in an account that pays 2% 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. (b) Find the amount in the account at the end of 2 years.

Answer 1

First year would be 9180 and the second year would be 9363.6

Explanation:

I just take the interest 2% make it a decimal .02 and times that by 9000 which gives you 180 then just add that to the 9000 for the first year and then for the second take 9180 times .02 which gives you 183.6 and just add that too 9180 to get 9363.6