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Baldwin and Allie deposit 2,000.00 into a savings account which earns 8% interest compounded annually. They want to use the money in the account to go on a trip in 3 years. How much will they be able to spend?

Solution

Baldwin and Allie deposit 2, 000.00 into a savings account which earns 8% interest compounded annually. They want to use the money in the account to go on a trip in 3 years. How much will they be able to spend?

Solution

Amount : 2519.424

Solution steps

Translate the problem into an equation:

A = 2000 (1 + \frac{0.08}{1})^{1 \cdot 3}

2000 (1 + \frac{0.08}{1})^{1 \cdot 3} = 2519.424

Amount : 2519.424

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