If 8000 dollars is invested in a bank account at an interest rate of 10 per cent per year, find the amount in the bank after 15 years if interests is compounded annually

Answer 1

To find the amount in the bank after 15 years with interest compounded annually, we can use the formula for compound interest:

A = P(1 + r/n)^(nt)

Where:
A = the amount in the bank after time t
P = the principal amount (initial investment), which is $8000 in this case
r = the annual interest rate (expressed as a decimal), which is 10% or 0.10 in this case
n = the number of times that interest is compounded per year, which is 1 (annually) in this case
t = the number of years, which is 15 in this case

Plugging these values into the formula:

A = 8000(1 + 0.10/1)^(1*15)
A = 8000(1 + 0.10)^(15)
A = 8000(1.10)^(15)
A = 8000(1.949)
A = $15,592

The amount in the bank after 15 years, with interest compounded annually, is $15,592.