The formula to calculate the future value of an investment with annual compounding is:
FV = P(1 + r)^n
Where:
FV = Future Value
P = Principal amount (initial deposit)
r = Annual interest rate (in decimal form)
n = Number of years
Plugging in the given values:
P = $1,400
r = 0.065
n = 15
FV = $1,400(1 + 0.065)^15
FV = $1,400(1.065)^15
FV ≈ $3,924.71
Therefore, after 15 years, Omar would have approximately $3,924 in the account.
Omar deposits $1,400 every year into an account earning an annual interest rate of 6.5% compounded annually. How much would he have in the account after 15 years, to the nearest dollar? Use the following formula to determine your answer.
1 answer
1 answer