Compound interest formula

[rachelmaddie]

Hi. I need my work checked please.

19)
The compound interest formula is equal to A = P(1 + r/n)^nt
where A is the investment value,
P is the principal amount of money to be invested
r is the rate of interest in decimal
t is the number of time periods
n is the number of time interest is compounded per year
Substitute into the compound interest formula
P = $4,900
t = 5 years
r = 0.035
n = 2
A = $4,900(1 + 0.035/2)^2*5
A = $4,900(1.0175)^10 = $5,828.28
Heather’s account balance will be $5,828.28 after 5 years if the interest is compounded 2 times each year.

 

[jonah2.0]

Beer soaked comment follows.

Hi. I need my work checked please.
View attachment 20859
19)
The compound interest formula is equal to A = P(1 + r/n)^nt
where A is the investment value,
P is the principal amount of money to be invested
r is the rate of interest in decimal
t is the number of time periods
n is the number of time interest is compounded per year
Substitute into the compound interest formula
P = $4,900
t = 5 years
r = 0.035
n = 2
A = $4,900(1 + 0.035/2)^2*5
A = $4,900(1.0175)^10 = $5,828.28
Heather’s account balance will be $5,828.28 after 5 years if the interest is compounded 2 times each year.

Looks good.

 

[Deleted member 4993]

Hi. I need my work checked please.
View attachment 20859
19)
The compound interest formula is equal to A = P(1 + r/n)^nt
where A is the investment value,
P is the principal amount of money to be invested
r is the rate of interest in decimal
t is the number of time periods
n is the number of time interest is compounded per year
Substitute into the compound interest formula
P = $4,900
t = 5 years
r = 0.035
n = 2
A = $4,900(1 + 0.035/2)^2*5
A = $4,900(1.0175)^10 = $5,828.28
Heather’s account balance will be $5,828.28 after 5 years if the interest is compounded 2 times each year.

You write:

n = 2

A = $4,900(1 + 0.035/2)^2*5 ................................This should be: A = $4,900(1 + 0.035/2)^(2*5)

According to PEMDAS - you need to do use the parentheses to conduct 2*5 before Exponentiation.

A = $4,900(1.0175)^10 = $5,828.28