# Compounded Intrest?

• May 22nd 2008, 03:36 PM
SarynJumail
Compounded Intrest?
You deposit \$4000 in an account that pays 9% interest compounded yearly.
Find the balance after 15 years.

I used this formula:
y = C(1 + r)^15

So I substitute:
y = (4000)(1 + .09)^15
y = (4000)(1.09)^15

Do I multiply the first two numbers before doing the power? Or do I do 1.09^15 first?
• May 22nd 2008, 04:39 PM
sean.1986
Quote:

Originally Posted by SarynJumail
You deposit \$4000 in an account that pays 9% interest compounded yearly.
Find the balance after 15 years.

I used this formula:
y = C(1 + r)^15

So I substitute:
y = (4000)(1 + .09)^15
y = (4000)(1.09)^15

Do I multiply the first two numbers before doing the power? Or do I do 1.09^15 first?

You multiply it by 1.09 for every year that it gets interest.

So it's 4000 * 1.09 * 1.09 * 1.09...

You do the power first otherwise you're doing (4000 * 1.09) * (4000 * 1.09) * (4000 * 1.09)... Which is wrong.
• May 22nd 2008, 05:03 PM
SarynJumail
Okay....so I do the exponent before the multiplication...I wasn't sure because it was outside the ()...
But I get it now, thanks.
• May 22nd 2008, 05:04 PM
Chris L T521
Quote:

Originally Posted by SarynJumail
You deposit \$4000 in an account that pays 9% interest compounded yearly.
Find the balance after 15 years.

I used this formula:
y = C(1 + r)^15

So I substitute:
y = (4000)(1 + .09)^15
y = (4000)(1.09)^15

Do I multiply the first two numbers before doing the power? Or do I do 1.09^15 first?

Do $(1.09)^{15}$ first, then multiply by 4000.

w00t!!! this is my 1(Sun)(Sun)th Post!! :D
• May 22nd 2008, 07:10 PM
sean.1986
Quote:

Originally Posted by SarynJumail
Okay....so I do the exponent before the multiplication...I wasn't sure because it was outside the ()...
But I get it now, thanks.

But the 4000 is also outside of the brackets of the 1.09. It's the things INSIDE each set of brackets you do first, not the things next to them. Then indices, division, multiplication, addition and subtraction...
• May 22nd 2008, 10:02 PM
TKHunny
You seem to have studied the Order of Operations.

4000*1.09^15 is not ambiguous.

4000*(1.09^15) is the same.

4000*(1.09)^15 is the same.

4000*((1.09)^15) is the same.

(4000)*((1.09)^15) is the same.

(4000*1.09)^15 is NOT the same.