Question

Alyson deposits $500 in the bank for 12 years. The bank offers her a 4% interest rate compounded annually. How much money will be in her account at the end of the 12 years? (Remember to round your answer to the nearest cent.)

Answer 1

First calculate the interest per year by multiplying the deposit by the interest rate: $500 * .04 = $<<500*.04=20>>20.
Since the interest is compounded annually, multiply the interest by the number of years to calculate the total interest: $20 * 12 years = $<<20*12=240>>240.
Finally, add the interest to the original deposit to find the total amount of money in the account: $500 + $240 = $<<500+240=740>>740. Answer: \boxed{740}.