Question

Georg invests $5000 for 14 years at a rate of 2% per year compound interest. Calculate the interest he receives. Give your answer correct to the nearest dollar.

Answer 1

Answer:

5,000 (1.02)^14

Step-by-step explanation

Break Down The Problem:

George invests $5000 for 14 years at a rate of 2% per year compound interest. Calculate the interest he receives. Give your answer correct to the nearest dollar.

                                           5,000 (1.02)^14

• $5,000 (initial amount/ the amount he started with)
• 1.02 (2% in decimal form is .02, you have to add this to 1 instead of subtracting because the money value is going to increase)
• ^14 (the number of years that the amount is increasing)

Solve The Problem:

                                            5,000 (1.02)^14

                                            5,000 (1.319479)

                                            6597.395 [ you need to simplify it]

                                            $ 6597.00