Jenna opened a savings account and deposited 710.00. The account earns 13.06% interest, compounded annually. If she wants to use the money to buy a new bicycle in 3 years, how much will she be able to spend on the bike?

Solution

Solution

Amount : 1026.09

Solution steps

Translate the problem into an equation:

A = 710 (1 + \frac{0.1306}{1})^{1 \cdot 3}

710 (1 + \frac{0.1306}{1})^{1 \cdot 3} = 1026.08961 \dots

Round to the nearest hundredth:

1026.09

Amount : 1026.09

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