Gerhard deposited $5,600 into a savings account that earns 4.5% simple interest each year calculated annually. What is the future value of Gerhard's account after 12 years?

A. $14,224
B. $8,624
C. $3,024
D. $5,852

Question

Gerhard deposited $5,600 into a savings account that earns 4.5% simple interest each year calculated annually. What is the future value of Gerhard's account after 12 years?

 		A.	$14,224
 		B.	$8,624
 		C.	$3,024
 		D.	$5,852

mathstudent55 · Answer

I = Prt
I = interest earned
P = present value
r = annual interest rate as decimal
t = time in years
The future value is F = P + I or F = P + Prt

stamp · Answer

$$i=$5,600(4\%/year)12\ years$$=$3,024$$5600+3024=$$