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Kaiden deposited $6200 into a savings account for which interest is compounded weekly at a rate of 2.77%.


How much interest will he earn after 8 years?

Verified Answer :

Kaiden will earn $1537.59 as interest.

Important information

  • Principal value = $6200
  • Rate of compund interest = 2.77%
  • Time = 8 year.

We need to find the interest.

Compound interest:

The formula of amount after compound interest is:

\(A=P\left(1+\dfrac{r}{n}\right)^{nt}\)

Where, P is the principal value, r is rate in decimal, n is the number of times interest compounded in a year and t is the number of years.

We know that 1 year = 52 weeks. So, \(n=52\).

\(A=6200\left(1+\dfrac{0.0277}{52}\right)^{52*8}\)

\(A=6200\left(\dfrac{52.0277}{52}\right)^{416}\)

\(A=7737.590163\)

\(A\approx 7737.59\)

Now, calculate the interest.

\(I=A-P\)

\(I=7737.59-6200\)

\(I=1537.59\)

Therefore, Kaiden will earn $1537.59 as interest.

Find out more about 'Compound interest' here:

https://brainly.com/question/25857212

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