Suppose that 5500 is placed in an account that pays 2% interest compounded each year. Assume that no withdrawals are made from the account. Find the amount in the account at the end of 1 year.

Solution

Solution

Amount : 5610

Solution steps

Translate the problem into an equation:

A = 5500 (1 + \frac{0.02}{1})^{1 \cdot 1}

5500 (1 + \frac{0.02}{1})^{1 \cdot 1} = 5610

Amount : 5610

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