Solve the problem.
-A woman invested $7,000 at 6% (or 0.06)for 7 years. How much did she have in her account at the end of 7 years?
A)$294
B)$9,940
C)$2,940
D)$5,880

Question

Solve the problem.
-A woman invested $7,000 at 6% (or 0.06)for 7 years. How much did she have in her account at the end of 7 years? 
A)$294 
B)$9,940 
C)$2,940 
D)$5,880

Quizplus · Accepted Answer

To calculate the total amount, we need to use the formula: 
Total Amount = Principal + (Principal x Rate x Time)
Where Principal = $7,000, Rate = 6% or 0.06, and Time = 7 years
Total Amount = 7,000 + (7,000 x 0.06 x 7)
Total Amount = $9,940
Therefore, she had $9,940 in her account at the end of 7 years. The correct answer is B. Use the formula for compound interest: A = P(1 + r/n)^(n*t) where A is the amount, P is the principal, r is the interest rate, n is the number of times compounded per year, and t is the time in years.

In this problem, P = $7,000, r = 6% or 0.06, n = 1 (compounded annually), and t = 7 years.

A = 7000(1 + 0.06/1)^(1*7)
A = $9,940.

Solve the Problem. -A Woman Invested $7,000 at 6% (Or 0.06)for 7 Years