A bank account earns 3% interest per year. If you deposit $1,000 into the account, what equation would you use to determine how much will be in the account after 5 years?(1 point)

Question

Responses

y=1,000(1.03)^5
y equals 1,000 left parenthesis 1.03 right parenthesis superscript 5 baseline

y=5(1.03)^1,000
y equals 5 left parenthesis 1.03 right parenthesis superscript 1,000 baseline

y=5(0.03)^1,000
y equals 5 left parenthesis 0.03 right parenthesis superscript 1,000 baseline

y=1,000(0.03)^5
y equals 1,000 left parenthesis 0.03 right parenthesis superscript 5 baseline

Answer 1

The correct equation to determine how much will be in the account after 5 years, given a 3% interest rate and an initial deposit of $1,000, is:

y = 1,000(1.03)^5

This equation reflects the initial amount (the principal) multiplied by (1 + interest rate)^number of years, which accounts for compound interest.