Question

You invest $20,000 at an interest rate of 5.2% compounded annually. What is the total in your account after 3 years?

Answer 1

`20000xx5.2/100xx3+20000`

Explanation:

20000 is the amount you invested, let `20000=m`

5.2% is the percentage of interest you earn for `m`, `5.2%=i`

3 years is the amount of time `m` stays in the bank `3` years= `t`

and compounded annually means `20000` earns `5.2%`of
`20000` once a year

before any solutions are made we need to convert the interest rate to a decimal, just divide the percentage by 100.

`5.2/100=0.052`, so really `i=0.052`

`mxxixxt+m=`answer

`20000xx0.052xx3+20000=23120`

answer `=$23120`

answer `- m` `=` the amount of interest earned

`23120-20000=3120`

the amount of interest earned `=$3120`