derek deposited $7,000 in an account earning 15% interest compounded annually. to the nearest cent, how much…

derek deposited $7,000 in an account earning 15% interest compounded annually. to the nearest cent, how much interest will he earn in 3 years? use the formula $b = p(1 + r)^t$, where $b$ is the balance (final amount), $p$ is the principal (starting amount), $r$ is the interest rate expressed as a decimal, and $t$ is the time in years.

derek deposited $7,000 in an account earning 15% interest compounded annually. to the nearest cent, how much interest will he earn in 3 years? use the formula $b = p(1 + r)^t$, where $b$ is the balance (final amount), $p$ is the principal (starting amount), $r$ is the interest rate expressed as a decimal, and $t$ is the time in years.

Answer

Answer:

$3751.38

Explanation:

Step1: Identify values

$p = 7000$, $r=0.15$, $t = 3$

Step2: Calculate the balance

$B=p(1 + r)^t=7000\times(1 + 0.15)^3=7000\times1.15^3=7000\times1.520875 = 10646.125$

Step3: Calculate the interest

Interest $=B - p=10646.125-7000 = 3646.125\approx3751.38$ (rounded to nearest cent)