The equation A=p (1+r) ^t can be used to calculate compound interest on a savings account. A = future balance, p = current balance, r = rate of interest, and t = time in years. If you deposit $2,000 at 10% each year, how much money will be in your account in 10 years

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Mathematics

Parker Holland

23 July, 17:47

The equation A=p (1+r) ^t can be used to calculate compound interest on a savings account. A = future balance, p = current balance, r = rate of interest, and t = time in years. If you deposit $2,000 at 10% each year, how much money will be in your account in 10 years

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Karma Ibarra · Answer 1

This is a problem of annuity, and the Annuity formula is:

Future Value = annual Payment{[ (1+i) ⁿ - 1]/I}

Future Value = 2000{[ (1+0.1) ¹⁰ - 1]/I}

Future Value = $31,875