Question

Sumi​ Kato's savings account has a balance of ​$4419 After 4 years what will the amount of interest be at ​4.5% compounded​ annually?

the answer is 3,075.10 but i have no idea why i cant get the answer myself. Can someone explain the steps?

Answer 1

compound interest formula

\[A = P(1+\frac{ r }{ n })^{nt}\]
where P is the starting balance ($4419), r is the interest rate as a decimal (0.045), n is the # of times compounded per year (it compounds annually which means once per year, so n = 1), and t is time (4 years), and A is the final balance. plug everything in and evaluate A.