College Algebra (10th Edition)

Published by Pearson
ISBN 10: 0321979478
ISBN 13: 978-0-32197-947-6

Chapter 6 - Section 6.7 - Financial Models - 6.7 Assess Your Understanding - Page 475: 43


$\approx{{\$}} 104,335$

Work Step by Step

The amount A after t years due to a principal P invested at an annual interest rate r, expressed as a decimal, compounded n times per year is $A=P\displaystyle \cdot(1+\frac{r}{n})^{nt}$ --- compounded $n=1$ times per year$,r=0.03, t=5, nt=5, P=90,000$ $A=90,000\displaystyle \cdot(1+\frac{0.03}{1})^{5}\approx{{\$}} 104,334.67$ $\approx{{\$}} 104,335$
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