##### hat is the total amount on deposit at the end of 6 years, what is the interset

 Calculus Tutor: None Selected Time limit: 1 Day

Jul 9th, 2015

The question uses compound interest, which the formula is: A = P(1 + r/n)^nt; where A is the amount accumulated, P is the principal amount, r is the interest rate, n is the compounds per period and t is the number of periods. r must be in a decimal (so 8% / 100 = 0.08).

For the first part of the question, we are going to find A.

A = 31,000 (1+ 0.08/1)^(1)(6)

A = 31,000 (1.08)^6

A = 31,000 (1.58687432294)

A = 49,193.10 ; Therefore after 6 years, the total amount is \$49, 193. 10

For the second part of the question, we just subtract A from the P amount (final amount minus initial amount).

Therefore: A - P = r

49, 193.10 - 31, 000 = 18, 193.10

Therefore, the interest earned in the period of time is: \$18, 193.10!

Please let me know if you need any clarification. I'm always happy to answer your questions. Thank you very much!
Jul 9th, 2015

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Jul 9th, 2015
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Jul 9th, 2015
Dec 8th, 2016
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