Question

2. Find the balance in the account after the given period.
$4000 principal earning 6% compounded annually, after 5 yr

a. $6,726.28
b. $5,352.90
c. $5,395.40
d. $7,716.74

Answer 1

P = Po(1+r)^n.

n = 1Comp./yr. * 5yrs = 5 Compounding periods.

P = 4000(1.06)^5 =

Answer 2

b. 5,352.90