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Your parents deposited $1,500 into a new college fund that will earn an annual compound interest rate of 3%. How much money will be in the account when you need it for college in 5 years? (write and use the compound interest formula)

THANK YOU!!

Answer :

mhanifa

Answer:

  • $1738.91

Step-by-step explanation:

Given

  • Deposit: P = $1500
  • Interest rate: r = 3% = 0.03 compounded
  • Time: t = 5 years
  • Compound number: n =1 per year
  • Final amount A= ?

Formula for compound interest is:

  • A = P(1 + r/n)^nt

Substituting values

  • A = 1500(1 + 0.03/1)^1*5 =
  • 1500(1.03^5) =
  • $1738.91

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