Stephens invests in an account that pays 3% compound interest annually. He invests $5,500. He uses the expression P (1+r) t to find the total value of the account

A = P * (1+r) ^t

A = 5500 * (1+0.03) ^t

A = 5500 (1.03) ^t

If we knew the value of t, ie if we knew how long he keeps the money in the account, then we can find out how much money will be in there after t years.

For example, if t = 5 years go by, then

A = 5500 * (1.03) ^t

A = 5500 * (1.03) ^5

A = 6,376.00740865

A = 6,376.01

is the amount of money in the account at the end of 5 years.