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 the final - amount $B$

$B=p(1 + r)^t=2017\times(1 + 0.11)^5$ First, calculate $(1 + 0.11)^5$: $(1 + 0.11)^5=1.11^5=1.11\times1.11\times1.11\times1.11\times1.11\approx1.685058$ Then, $B = 2017\times1.685058\approx3398.76$

Step3: Calculate the interest earned

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

Answer:

$1381.76$