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6 February, 17:53

A 4,000.00 principal earns 5% interest, compounded annually. After 4 years, what is the balance in the account?

A. 500,000.00

B. 4,862.03

C. 4,600.00

D. 20,250.00

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Answers (1)
  1. 6 February, 18:50
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    The compound interest formula is given.

    Principal is $4,000

    Rate of interest is 5% or 0.05

    Number of times compounded is 1 (once per year)

    T (or time in years) is 4

    The balance after 4 years is $4,862.03
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