lance opened a savings account with a deposit of $1,200. the account pays 3% interest compounded annually…

lance opened a savings account with a deposit of $1,200. the account pays 3% interest compounded annually. what will be the account balance be at the end of 1 year if lance makes no other deposits or withdrawals? (enter your answer without commas.)

lance opened a savings account with a deposit of $1,200. the account pays 3% interest compounded annually. what will be the account balance be at the end of 1 year if lance makes no other deposits or withdrawals? (enter your answer without commas.)

Answer

Explanation:

Step1: Identify compound - interest formula

The compound - interest formula is $A = P(1 + r)^t$, 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

Given $r = 3%=0.03$, $P=$1200$, and $t = 1$ year.

Step3: Substitute values into the formula

$A=1200\times(1 + 0.03)^1$.

Step4: Calculate the final amount

$A=1200\times1.03 = 1236$.

Answer:

1236