They are using compound interest.
amount = 1000(1.05)^6
= 1340.0956..
= $ 1340.10
You invested $1000 in a savings account in 6th grade. The account pays 5% annual interest. How much money will be in the account after 6 years? I understand how to set the equation up, but I'm not sure how to get the final answer. This is a question from my textbook that shows all the steps and the answer, but I can't figure out how they got a final answer of $1340.10. Please Help Me Understand This!!
1 answer
1 answer