Question

A retiree invests $3,000 in a savings plan that pays 5% per year. What will the account balance be at the end of the first year?

Answer 1

Answer: $3,150.00

Step-by-step explanation:

To calculate interest you would do the following:

money invested x interest rate(in decimal form) x time (how many years it was gathering interest)

That would look like this:

$3000 * .05 * 1 = 150.00$

that is the amount of money the interest gathers. Now, you need to add it to the original amount of money. Like so:

$3000+150=3150$

Hence, your answer is $3,150.00