nick has $3,572 in an account that earns 1% interest compounded annually. to the nearest cent, how much…

nick has $3,572 in an account that earns 1% interest compounded annually. to the nearest cent, how much interest will he earn in 4 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.

nick has $3,572 in an account that earns 1% interest compounded annually. to the nearest cent, how much interest will he earn in 4 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 the values

$p = 3572$, $r=0.01$, $t = 4$

Step2: Calculate the balance $B$

$B=p(1 + r)^t=3572\times(1 + 0.01)^4$ First, calculate $(1 + 0.01)^4=1.01^4=1.04060401$. Then, $B = 3572\times1.04060401\approx3717.047523$.

Step3: Calculate the interest

Interest $=B - p$. Interest $=3717.047523- 3572=145.047523\approx145.05$.

Answer:

$145.05$