You deposit $675 in an account that earns 3.4% annul interest compounded twice a year. A. Write a function that represents this situation. B. Find the balance in the account after 2.5 years

Question

Mathematics

Lilliana Sexton

2 August, 02:51

You deposit $675 in an account that earns 3.4% annul interest compounded twice a year. A. Write a function that represents this situation. B. Find the balance in the account after 2.5 years

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Answers (1)

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Dallas Webb · Answer 1

Step-by-step explanation:

A) Initial amount deposited into the account is $675 This means that the principal,

P = 500

It was compounded twice in a year. This means that

n = 1

The rate at which the principal was compounded is 3.4%. So

r = 3.4/100 = 0.034

It was compounded for t years

The formula for compound interest is

A = P (1+r/n) ^nt

A = total amount in the account at the end of t years. Therefore, the function that represents this situation would be

A = 675 (1 + 0.034/2) ^ 2 * t

A = 675 (1.017) ^2t

B) at t = 2.5,

A = 675 (1.017) ^2 * 2.5

A = 675 (1.017) ^5

A = $734.36