1600 dollars is placed in an account with an ...
1600 dollars is placed in an account with an annual interest rate of 5.25%. how much will be in the account after 25 years, to the nearest cent?
Answer
# Answer:
$5777.04$
# Explanation:
## Step1: Identify the compound - interest formula
$A = P(1 + r)^t$ where $A$ is the final amount, $P$ is the principal amount, $r$ is the annual interest rate (in decimal form), and $t$ is the number of years.
## Step2: Convert the interest rate to decimal
$r=5.25\%=0.0525$, $P = 1600$, $t = 25$
## Step3: Substitute the values into the formula
$A=1600\times(1 + 0.0525)^{25}$
## Step4: Calculate $(1 + 0.0525)^{25}$
$(1 + 0.0525)^{25}\approx3.61065$
## Step5: Calculate the final amount $A$
$A=1600\times3.61065 = 5777.04$