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12 September, 08:50

An initial investment of $1000 is appreciated for 4 years in an account that earns 4% interest, compounded annually. Find the amount of money in the account at the end of the period.

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  1. 12 September, 11:14
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    Answer: $116.99

    Step-by-step explanation:

    By using compound interest formula which said:

    A = P (1 + r/n) ^ (n*t)

    P=Principal = 1000

    r=rate=4/100

    n=1

    t = 4

    Apply the above formula

    A = P (1 + r/n) ^ (n*t)

    A = 1000 (1 + 0.04/1) ^ (1 * 4)

    A = 100 (1.04) ^4

    A = 100 * 1.17

    A = 116.99
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