How much would $500 invested at 8% interest compounded annually be worth after 4 years? Round your answer to the nearest cent.𝐴(𝑡)=𝑃(1+𝑟𝑛)𝑛𝑡A(t)=P(1+ nr ) nt A.$680.24B.$660.00C.$688.56D.$541.22SUBMITarrow_backPREVIOUS
Question
How much would 680.24B.688.56D.$541.22SUBMITarrow_backPREVIOUS
Solution
To solve this problem, we will use the formula for compound interest which is A = P(1 + r/n)^(nt).
Here, P = principal amount (the initial amount of money) = $500 r = annual interest rate (in decimal form) = 8% = 0.08 n = number of times that interest is compounded per year = 1 (since it's compounded annually) t = time the money is invested for in years = 4 years
Substituting these values into the formula, we get:
A = 500(1 + 0.08/1)^(1*4) A = 500(1 + 0.08)^4 A = 500(1.08)^4 A = 500 * 1.36049
So, the amount after 4 years would be approximately 680.24.
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