Question

Emilia puts $6,589.00 into an account to use for school expenses. The account earns 9.81% interest, compounded annually. How much will be in the account after 4 years?

Answer 1

Answer: $9,538.51 after 4 years
Explanation: View photo
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Answer 2

Answer:

$9,580.48

Step-by-step explanation:

Emilia puts $6,589.00 into an account to use for school expenses. The account earns 9.81% interest, compounded annually.

To calculate how much will be in the account after 4 years, we can use the compound interest formula:

$\boxed{\begin{array}{l}\underline{\textsf{Compound Interest Formula}}\\\\A=P\left(1+\dfrac{r}{n}\right)^{nt}\\\\\textsf{where:}\\\phantom{ww}\bullet\;\;\textsf{ A is the final amount.}\\\phantom{ww}\bullet\;\;\textsf{ P is the principal amount.}\\\phantom{ww}\bullet\;\;\textsf{ r is the interest rate (in decimal form).}\\\phantom{ww}\bullet\;\;\textsf{ n is the number of times interest is applied per year.}\\\phantom{ww}\bullet\;\;\textsf{ t is the time (in years).}\end{array}}$

In this case:

• P = $6,589.00
• r = 9.81% = 0.0981
• n = 1 (annually)
• t = 4 years

Substitute the values into the formula and solve for A:

$A=6589\left(1+\dfrac{0.0981}{1}\right)^{1 \times 4}$

$A=6589\left(1+0.0981\right)^{4}$

$A=6589\left(1.0981\right)^{4}$

$A=6589\left(1.454010578...\right)$

$A=9580.47570...$

$A=\ 9580.48$

Therefore, after 4 years, there will be $9,580.48 in the account.