Question

Bill invested $2000 at a rate of 5% compounded annually. What is the value of his investment at the end of 5 years? Round answers with money appropriately (to the nearest cent).

Answer 1

Given : Bill invested $2000 at a rate of 5% compounded annually.

To Find :  investment at the end of 5 years

Solution :

P = 2000  $

R = 5 %

n = 5  

A = P (1 + R/100)ⁿ

=> A = 2000 ( 1 + 5/100)⁵

=> A = 2000 ( 21/20)⁵

=> A = 2,552.56

investment at the end of 5 years = $2552 and 56 cents

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