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

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Answer 1 · 2016-05-19T23:42:09

$20000 \times \frac{5.2}{100} \times 3 + 20000$ $20000xx5.2/100xx3+20000$

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

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

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

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

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

$\frac{5.2}{100} = 0.052$ $5.2/100=0.052$ , so really $i = 0.052$ $i=0.052$

$m \times i \times t + m =$ $mxxixxt+m=$ answer

$20000 \times 0.052 \times 3 + 20000 = 23120$ $20000xx0.052xx3+20000=23120$

answer $= $ 23120$ $=$23120$

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

$23120 - 20000 = 3120$ $23120-20000=3120$

the amount of interest earned $= $ 3120$ $=$3120$