rob has $5,000 in an account that earns 2% interest compounded annually. to the nearest cent, how much will…

rob has $5,000 in an account that earns 2% interest compounded annually. to the nearest cent, how much will he have in 5 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.

rob has $5,000 in an account that earns 2% interest compounded annually. to the nearest cent, how much will he have in 5 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

$p = 5000$, $r=0.02$, $t = 5$

Step2: Substitute into formula

$B=5000\times(1 + 0.02)^{5}$

Step3: Calculate $(1 + 0.02)^{5}$

$(1 + 0.02)^{5}=1.02^{5}=1.1040808032$

Step4: Calculate $B$

$B = 5000\times1.1040808032=5520.404016$

Answer:

$5520.40$