Answer:
$4596.63
Explanation:
Given:
• The Principal Alan deposited, P = $4000
,• Annual Interest Rate, r = 2.8% = 0.028
,• Compounding Period, k = 2 (Twice in a year)
,• Time, t = 5 years
We want to determine how much he will have in the account after 5 years.
In order to carry out this calculation, use the compound interest formula below:
[tex]A(t)=P(1+\frac{r}{k})^{tk}[/tex]Substitute the values defined above:
[tex]A(t)=4000(1+\frac{0.028}{2})^{2\times5}[/tex]Finally, simplify and round to the nearest cent.
[tex]\begin{gathered} A(t)=4000(1+0.014)^{10} \\ =4000(1.014)^{10} \\ =\$4596.63 \end{gathered}[/tex]Alan will have $4596.63 in his account after 5 years.
