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anonymous
 4 years ago
find the amount of money in the bank account given the following conditions:
initial deposit= $5000, annual rate= 3%, time= 2 years
anonymous
 4 years ago
find the amount of money in the bank account given the following conditions: initial deposit= $5000, annual rate= 3%, time= 2 years

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anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0a = initial deposit, r = 1.03, n = 2

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0says answer is 5,304.50

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0It should be 5000 * (1.03)^2. Assuming compounding of the interest rate.

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0oh so its 5000(1.03)^2

waheguru
 4 years ago
Best ResponseYou've already chosen the best response.0Gt where dide u get the 1.3 from

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0At the end of first year, you will have: 5000 + 5000 * 0.03 = 5000 * (1.03). At the end of second year, you will have: 5000 * (1.03) + 5000 * (1.03) * (0.03) Because you earn interest in the second year on the interest amount of the first year. So, that is same as: 5000 * (1.03)^2. In general, for compounded interest, for n years at rate r and principal p, you get: p * (1+r)^n

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0oh yeah compounding of interest... didnt tought of that

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0so how do i get the answer

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0Use a calculator to find: 5000 * (1.03) * (1.03). That should give you: 5,304.50

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0thanks it swas 5304.5

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0Sometimes, these kind of problems can be formulated such that the interest rate "r" is compounded semiannually or something else. In that case, the "formula" will be similar, but in that case, in p*(1+r)^n, r represents the rate of interest for that period (semiannually for example) and n represents the total "compounding" periods.

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0well we all stupidly used simple interest formula..silly me

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0so what is the p r and n represent in the equation

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0For example, in this exact same problem, if compounding happened semiannually, then you will have the following at the end of two years: 5000 * (1+0.015)^4

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0p is initial amount. n is number of periods.

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0r is rate of interest for that period.

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0principle,rate of interest and time period

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0so if it were 3000 instead of 5000 and rate was 5.5 and time was 5 years how do i set that up

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0use the same algorithm

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0assuming annual compounding.

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0ok so its similar to the other one

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0Yeah, I got the same. :)

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0Oh sorry. My mistake. I gave you the sum formula for geometric progression. The correct formula in this case is: \[a _{n} = ar ^{n1}\], but in this case, you would take it as \[a _{n} = ar ^{n}\]

anonymous
 4 years ago
Best ResponseYou've already chosen the best response.0thakns again everyone
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