To find the balance after 10 years of a savings account with a $30,000 principal and a 10% interest rate compounded yearly, we can use the compound interest formula:
A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment/loan, including interest
P = the principal investment amount (the initial deposit or loan amount) = $30,000
r = the annual interest rate (in decimal form) = 10% = 0.10
n = the number of times that interest is compounded per year = 1 (compounded yearly)
t = the number of years the money is invested or borrowed = 10
Plugging these values into the formula, we get:
A = $30,000(1 + 0.10/1)^(1*10)
A = $30,000(1 + 0.10)^10
A = $30,000(1.10)^10
Evaluating this expression, we find:
A = $30,000 * 2.59374
A ≈ $77,812.20
Therefore, the correct answer is:
$77,812.27
Find the balance after 10 years of a $30,000 savings account that pays 10% interest compounded yearly.(1 point) Responses $2,245,256.05 $2,245,256.05 $112,070.90 $112,070.90 $77,812.27 $77,812.27 $33,154.81
1 answer
1 answer