Question
You put $317 into an investment at 5% compounded annually for two years. What will the balance be at the end of two years?
Answers
GPT 3.5
To calculate the final balance after two years with compound interest, you can use the formula:
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = the principal amount (initial investment) = $317
r = annual interest rate (in decimal form) = 5% = 0.05
n = number of times interest is compounded per year = 1 (annually)
t = number of years = 2
Plugging in the values:
A = $317(1 + 0.05/1)^(1*2)
A = $317(1.05)^2
A = $317(1.1025)
A = $317 * 1.1025
A = $349.27
Therefore, the balance at the end of two years will be $349.27.
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = the principal amount (initial investment) = $317
r = annual interest rate (in decimal form) = 5% = 0.05
n = number of times interest is compounded per year = 1 (annually)
t = number of years = 2
Plugging in the values:
A = $317(1 + 0.05/1)^(1*2)
A = $317(1.05)^2
A = $317(1.1025)
A = $317 * 1.1025
A = $349.27
Therefore, the balance at the end of two years will be $349.27.