albert has $1,000 in an account. the interest rate is 5% compounded annually. to the nearest cent, how much…

Answer:

$215.51$

Explanation:

Step1: Identify the compound - interest formula

$A = P(1 + r)^t$, where $P$ is the principal amount, $r$ is the annual interest rate (in decimal form), and $t$ is the number of years. Here, $P=$1000$, $r = 0.05$, and $t = 4$.

Step2: Calculate the amount $A$ after 4 years

$A=1000\times(1 + 0.05)^4=1000\times(1.05)^4$. $(1.05)^4=1.05\times1.05\times1.05\times1.05 = 1.21550625$. So, $A = 1000\times1.21550625=$1215.50625$.

Step3: Calculate the interest earned

Interest $I=A - P$. $I = 1215.50625-1000=$215.50625\approx$215.51$.