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1 June, 17:54

An ATM with a service fee of $2 is used by a person 100 times in a year. What would be the future value in 10 years (use a 3 percent rate) of the annual amount paid in ATM fees?

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  1. 1 June, 20:10
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    Answer:$2.699

    Explanation: Using the compound interest formula:

    Future value FV = P (1+r/n) ^nt

    Where FV=?

    P = 2

    r=0.03

    n=100

    t = 10

    Plugging the values, we get

    FV = 2 (1+0.03/100) ^100*10

    FV = 2 (1+0.0003) ^1000

    FV = 2 (1.0003) ^1000

    FV = 2 (1.35)

    FV = 2.7
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