Asked by e4rf

Daniel and Anita deposit $8,425.00 into a savings account which earns 3% 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 = 8425, r = 0.03, n = 1, t = 3:

A = 8425(1 + 0.03)^3 = 8425(1.03)^3 = 8425(1.092727) = 9206.224975

Rounded to the nearest cent: $9,206.22.