debbie has $4,000 in an account. the interest rate is 15% compounded annually. to the nearest cent, how much…

debbie has $4,000 in an account. the interest rate is 15% compounded annually. to the nearest cent, how much interest will she earn 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.

debbie has $4,000 in an account. the interest rate is 15% compounded annually. to the nearest cent, how much interest will she earn 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

$p = 4000$, $r=0.15$, $t = 2$

Step2: Calculate the balance

$B=p(1 + r)^t=4000\times(1 + 0.15)^2=4000\times1.15^2=4000\times1.3225 = 5290$

Step3: Calculate the interest

Interest $=B - p=5290-4000 = 1290$

Answer:

$1290.00$