question christopher invested $1,000 in an account paying an interest rate of 5.8% compounded annually…

question christopher invested $1,000 in an account paying an interest rate of 5.8% compounded annually. assuming no deposits or withdrawals are made, how much money, to the nearest dollar, would be in the account after 7 years? answer attempt 1 out of 2

question christopher invested $1,000 in an account paying an interest rate of 5.8% compounded annually. assuming no deposits or withdrawals are made, how much money, to the nearest dollar, would be in the account after 7 years? answer attempt 1 out of 2

Answer

Explanation:

Step1: Recall compound - interest formula

The compound - interest formula is $A = P(1 + r)^t$, where $A$ is the future value of the investment/loan, including interest, $P$ is the principal investment amount (the initial deposit or loan amount), $r$ is the annual interest rate (in decimal form), and $t$ is the number of years the money is invested or borrowed for.

Step2: Convert the interest rate to decimal

Given $r = 5.8%=0.058$, $P=$1000$, and $t = 7$ years.

Step3: Substitute values into the formula

$A=1000\times(1 + 0.058)^7$. First, calculate $(1 + 0.058)^7=(1.058)^7$. $(1.058)^7=1.058\times1.058\times1.058\times1.058\times1.058\times1.058\times1.058\approx1.48797$. Then, $A = 1000\times1.48797=$1488$ (rounded to the nearest dollar).

Answer:

$1488$