Web Analytics
Answered

Mr. Thompson plans to invest $7500 in a savings account that earns 2.75% simple annual interest. If he makes no other deposits or withdrawals, how much money will Mr. Thompson's account be worth after 10 years


please explain process on how to do this

Verified Answer :

what i would do is multiply $7500 by 10. because it asks what his account will be worth in 10 years so just multiply $7500 by 10.

Philooz

Since Mr. Thompson doesn't make any operations (deposits or withdrawals), his amount of money will only be modified by the interest rate.

Now, the rate is 2.75, meaning he adds 2.75% of his annual savings each year.

For the first year, he starts with $7,500. Meaning he'll gain $7,500 x 2.75/100 this year.
At the beginning of the second year, he'll have $7,911.75 on his account. Again, for the second year, he'll gain $7,911.75 x 2.75/100...
And so and so until he reaches the tenth year.

Related Questions