andy has $1,000 in an account. the interest rate is 15% compounded annually. to the nearest cent, how much…

andy has $1,000 in an account. the interest rate is 15% compounded annually. to the nearest cent, how much will he have in 2 years? use the formula b = p(1 + r)^t, where b is the balance (final amount), p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years.

andy has $1,000 in an account. the interest rate is 15% compounded annually. to the nearest cent, how much will he have in 2 years? use the formula b = p(1 + r)^t, where b is the balance (final amount), p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years.

Answer

Explanation:

Step1: Identify values

$p = 1000$, $r=0.15$, $t = 2$

Step2: Substitute into formula

$B = 1000\times(1 + 0.15)^{2}$

Step3: Calculate inside parentheses first

$1+0.15=1.15$

Step4: Calculate exponent

$1.15^{2}=1.15\times1.15 = 1.3225$

Step5: Multiply by principal

$B=1000\times1.3225 = 1322.5$

Answer:

$1322.50$