maggie has $2,674 in an account that earns 5% interest compounded annually. to the nearest cent, how much…

maggie has $2,674 in an account that earns 5% interest compounded annually. to the nearest cent, how much interest will she earn in 2 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.

maggie has $2,674 in an account that earns 5% interest compounded annually. to the nearest cent, how much interest will she earn in 2 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

Explanation:

Step1: Identify values

$p = 2674$, $r=0.05$, $t = 2$

Step2: Calculate final amount $B$

$B=p(1 + r)^t=2674\times(1 + 0.05)^2=2674\times1.05^2=2674\times1.1025=2948.085$

Step3: Calculate interest

Interest $=B - p=2948.085-2674 = 274.085\approx274.09$

Answer:

$274.09$