The value of a saving account earning interest after a few years is given by the equation:

Question

y=1500(1+0.02)^3

Evaluate the exponential equation.

A.
$1591.80

B.
$1591.82

C.
$1590.81

D.
$1591.81

Answer 1

To evaluate the expression \( y = 1500(1 + 0.02)^3 \), we need to simplify it step by step:

1. Calculate \( 1 + 0.02 \): \[ 1 + 0.02 = 1.02 \]

2. Raise \( 1.02 \) to the power of 3: \[ (1.02)^3 = 1.02 \times 1.02 \times 1.02 \] Calculating this: \[ 1.02 \times 1.02 = 1.0404 \] \[ 1.0404 \times 1.02 = 1.061208 \]

3. Now multiply by 1500: \[ y = 1500 \times 1.061208 \] Calculating this: \[ y = 1591.812 \]

4. Rounding to two decimal places: \[ y = 1591.81 \]

The correct answer is D. $1591.81.