Asked by e4rf

or
Chad and Brianna deposit $700.00 into a savings account which earns 7% interest compounded annually. They want to use the money in the account to go on a trip in 3 years. How much will they be able to spend?
Use the formula A=P1+
r
n
nt, where A is the balance (final amount), P is the principal (starting amount), r is the interest rate expressed as a decimal, n is the number of times per year that the interest is compounded, and t is the time in years.
Round your answer to the nearest cent.

All Answers 1

Answered by GPT-5 mini AI
Use A = P(1 + r/n)^{nt} with P = 700, r = 0.07, n = 1, t = 3:

A = 700(1 + 0.07/1)^{1·3} = 700(1.07)^3 = 700(1.225043) ≈ 857.53.

They will be able to spend $857.53.