Asked by e4rf

Malia opened a savings account and deposited $1,292.00. The account earns 7% interest, compounded annually. If she wants to use the money to buy a new bicycle in 3 years, how much will she be able to spend on the bike?
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
A = P(1 + r/n)^{nt} = 1292(1 + 0.07/1)^{1·3} = 1292(1.07)^3 = 1292(1.225043) = 1582.755556

Rounded to the nearest cent: $1,582.76.