Samantha deposited $300 in a savings account. The account earns 3.5% interest compounded annually. She makes no more deposits and withdraws no money from the account. How much interest will Samantha’s account have earned after 2 years?
She will have earned $321.37 after 2 years.
Interest Rate: 3.5%
Time: 2 years
Compounded Annually means that the principal will earn a certain amount this year and a greater amount next year, since it takes the new balance and add the interest rate to it.
Year 1: 3.5% of 300= 10.5
300 + 10.5 = 310.5
Year 1 balance: $310.5
Year 2: 3.5% of 310.5=10.87
310.5 + 10.87= 321.37
Year 2 balance: $321.31
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Mathematics, published 11.05.2023
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