Question

4500 8% 3 year compound interst​

Answer 1

Example

If you deposit $4500 into an account paying 7% annual interest compounded semi anualy , how much money will be in the account after 9 years?

Result

The amount is $8358.7 and the interest is $3858.7.

Explanation

STEP 1: To find amount we use formula:

A=P

(1+

r

n

)

n⋅t

A = total amount

P = principal or amount of money deposited,

r = annual interest rate

n = number of times compounded per year

t = time in years

In this example we have

P=$4500 , r=7% , n=2 and t=9 years

After plugging the given information we have

A

A

A

A

=4500

(1+

0.07

2

)

2⋅9

=4500⋅

1.035

18

=4500⋅1.857489

=8358.7

STEP 2: To find interest we use formula

A=P+I

, since

A=

8358.7

and

P =

4500

we have:

A

8358.7

I

I

=P+I

=4500+I

=8358.7−4500

=3858.7

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