Old Time Savings Bank pays 4% interest on its savings accounts. If you deposit $

Question

Old Time Savings Bank pays 4% interest on its savings accounts. If you deposit $2,200 in the bank and leave it there, how much interest will you earn in the first year? The second year? The tenth year? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Old Time Savings Bank pays 4% interest on its savings accounts. If you deposit $2,200 in the bank and leave it there, how much interest will you earn in the first year? The second year? The tenth year? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Explanation / Answer

Hi,

Please find the answer as follows:

First Year = 2200*(1+.04)^1 - 2200 = 88

Second Year = 2200*(1+.04)^2 - 2200 = 179.52 - 88 = 91.52

Tenth Year = 2200*(1+.04)^10 - 2200*(1+.04)^9 = 125.25

Thanks.

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.