Question

suppose you deposit 1000 in a college fund that pays 7.2% interest compounded annually. can you figure out what the account balance will be after 5 years

Answer 1

P = C (1 + r) ^ t use this equation when P is the future amount, C is initial deposit and r is the interest rate. And t is the time.
So in this case, C=1000, r=0.072, t=5

Answer 2

Just a tip, in this question it says compounded ANNUALLY but if there's a question that says compounded MONTHLY OR SEMI ANNUALLY you have to divide value of r or t in order to match to the context of the question.

Answer 3

i got 1415.708784197632

Answer 4

Yep ^^

Answer 5

thank you =)