# Compounded Annually

• Sep 19th 2008, 04:56 AM
magentarita
Compounded Annually
Kathy deposits $25 into an investment account with an annual rate of 5%, compounded annually. The amount in her account canbe determined by the formula A = P(1 + R)^(t), where P is the amountdeposited, R is the annual interest rate, and t is the number of years themoney is invested. If she makes no other deposits or withdrawals, how much money will be in her account at the end of 15 years? (1)$25.75 (3) $51.97 (2)$43.75 (4) $393.97 • Sep 19th 2008, 08:33 AM jonah $ A = 25\left( {1 + \frac{{.05}} {1}} \right)^{\left( {15 \times 1} \right)} \approx {\text{ ?}} $ • Sep 19th 2008, 08:34 AM courteous (3)$51.97

$A=25*(1+0.05)^{15}$
• Sep 19th 2008, 12:26 PM
magentarita
Great.....
Quote:

Originally Posted by jonah
$
A = 25\left( {1 + \frac{{.05}}
{1}} \right)^{\left( {15 \times 1} \right)} \approx {\text{ ?}}
$

Great set up.
• Sep 19th 2008, 12:27 PM
magentarita
Great...
Quote:

Originally Posted by courteous
(3) \$51.97

$A=25*(1+0.05)^{15}$

Thanks for showing me how to use this formula given by Jonah.