On the day Justine was born,her grandparents put $10,000 into a savings account that pays interest of 6% per year.How much money will Justine have in her account when she turns 18?

Question

Quizplus · Accepted Answer

We need to use the formula for compound interest:
A = P(1 + r/n)^(nt)
where:
A = the final amount
P = the principal (initial amount)
r = the annual interest rate (as a decimal)
n = the number of times the interest is compounded per year
t = the number of years

Plug in the given values:
P = 10,000
r = 0.06
n = 1 (compounded yearly)
t = 18

A = 10,000(1 + 0.06/1)^(1*18)
A = $28,543.69

Therefore, Justine will have $28,543.69 in her account when she turns 18. Answer choice C is correct.

On the Day Justine Was Born,her Grandparents Put $10,000 into a Savings