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Suppose that $4000 is placed in an account that pays 13% interest compounded each year.Assume that no withdrawals are made from the account.Follow the instructions below. Do not do any rounding.(a) Find the amount in the account at the end of 1 year.sil(b) Find the amount in the account at the end of 2 years

Sagot :

Answer:

Given that,

$4000 is placed in an account that pays 13% interest compounded each year.

a) Find the amount in the account at the end of 1 year.

we know that,

Amount after n years under compound interest rate r%,

[tex]=P(1+\frac{r}{100})^n[/tex]

Put n=1, we get

[tex]=4000(1+\frac{13}{100})[/tex][tex]=4000(\frac{113}{100})[/tex][tex]=4,520[/tex]

Amount in the account at the end of 1 year will be $4,520.

b) Find the amount in the account at the end of 2 years​

Put n=2, we get

[tex]=4000(1+\frac{13}{100})^2[/tex][tex]=4000(\frac{113}{100})^2=5,107.6[/tex]

Amount in the account at the end of 2 years​ is $5,107.6