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Isaac opened a savings account and deposited 500.00. The account earns 1% interest, compounded annually. If he wants to use the money to buy a new bicycle in 3 years, how much will he be able to spend on the bike?

Solution

Solution

Amount : 515.15

Solution steps

Translate the problem into an equation:

A = 500 (1 + \frac{0.01}{1})^{1 \cdot 3}

500 (1 + \frac{0.01}{1})^{1 \cdot 3} = 515.1505

Round to the nearest hundredth:

515.15

Amount : 515.15

Popular Examples

6 is 10 less than twice a number the sum of 2 numbers is 6. the sum of their squares is 28. find the numbers Betty puts 500.00 into an account to use for school expenses. The account earns 11% interest, compounded continuously. How much will be in the account after 6 years?The sum of twice a number and 1 is 11.Richard opened a savings account and deposited 600.00. The account earns 1% interest, compounded annually. If he wants to use the money to buy a new bicycle in 3 years, how much will he be able to spend on the bike?