Answer:
2376.20 (to the nearest cent)
Step-by-step explanation:
Given:
Principal, P = 700
Rate, r = 13% = 0.13
Compounding per year, n = 1 (compounded annually)
Time, t = 10 years
Apply formula
Balance,
A = P(1+r/n)^(nt)
= 700 (1 +0.13/1)^(1*10)
= 700(1.13)^10
= 2376.20 (to the nearest cent
Here is how you can estimate an answer to find the right one among different answers.
It takes money a number of years to double. In this case, it takes 72/13 = 5.5 years to double (by the rule of 72).
For ten years (<11), it should be less than doubling twice. Even if it did, it would be (700*2)*2 = 2800, but not more.
