billy deposited $5,000 in an account earning 1% interest compounded annually. to the nearest cent, how much…

Answer:

$50.00

Explanation:

Step1: Identify the formula

The simple - interest formula for compound interest compounded annually for 1 year is $I = P\times r$, where $P$ is the principal amount and $r$ is the annual interest rate.

Step2: Convert the interest rate to decimal

The interest rate $r = 1%=\frac{1}{100}=0.01$.

Step3: Substitute values into the formula

$P = 5000$ and $r = 0.01$. Then $I=P\times r=5000\times0.01 = 50$. So the interest earned is $50.00$ dollars.