2 answers
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It is easier to write it as
500*(1.05)^10
500*(1.05)^10
A = P(1 + r/n)^(nt)
Where:
A = the final amount of money in the account
P = the principal amount (initial deposit)
r = annual interest rate (as a decimal)
n = number of times interest is compounded per year
t = time (in years)
In this case, the initial deposit is $500, the interest rate is 5% (0.05 as a decimal), the interest is compounded annually (n = 1), and the time is 10 years.
Plugging these values into the formula:
A = 500(1 + 0.05/1)^(1*10)
A = 500(1.05)^10
Calculating this equation will give you the final amount of money in the savings account after 10 years.