Given:
• Principal, P = $1,240
,• Interest rate, r = 8% = 0.08
,• Time, t = 2 years
,• Number of times compounded = annually = 1 time a year
Let's calculate the total value of the investment.
To calculate, apply the compound interest formula:
[tex]A=P(1+\frac{r}{n})^{nt}[/tex]Where:
A is the final amount
P = 1240
r = 0.08
n = 1
t = 2
Input values into the formula and solve for A:
[tex]\begin{gathered} A=1240(1+\frac{0.08}{1})^{2*1} \\ \\ A=1240(1.08)^2 \\ \\ A=1240(1.1664) \end{gathered}[/tex]Solving further:
[tex]A=1446.34[/tex]Therefore, the total value of the investment after the given time is $1,446.34
ANSWER:
$1,446.34
