To model the situation with an exponential equation, we can use the formula for compound interest:
\[ A = P(1 + r)^t \]
Where:
- \( A \) is the amount of money accumulated after n years, including interest.
- \( P \) is the principal amount (the initial amount of money).
- \( r \) is the annual interest rate (decimal).
- \( t \) is the time the money is invested or borrowed for, in years.
In this case:
- \( P = 2550 \)
- \( r = 6.25% = 0.0625 \)
- \( t = 6 \) years
Substituting the values into the formula:
\[ A = 2550(1 + 0.0625)^6 \] \[ A = 2550(1.0625)^6 \] \[ A = 2550(1.484812) \] \[ A \approx 3786.64 \]
Rounding to the nearest cent, the amount of money he will have six years from now is approximately:
3786.64