bob has $2,017 in an account that earns 11% interest compounded annually. to the nearest cent, how much…

bob has $2,017 in an account that earns 11% interest compounded annually. to the nearest cent, how much interest will he earn in 5 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.

bob has $2,017 in an account that earns 11% interest compounded annually. to the nearest cent, how much interest will he earn in 5 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

$p = 2017$, $r=0.11$, $t = 5$

Step2: Calculate final amount B

$B=p(1 + r)^t=2017\times(1 + 0.11)^5$ $B=2017\times1.11^5$ $1.11^5=1.11\times1.11\times1.11\times1.11\times1.11 = 1.6850581551$ $B=2017\times1.6850581551\approx3398.76$

Step3: Calculate interest

Interest $=B - p$ Interest $=3398.76-2017 = 1381.76$

Answer:

$1381.76$