The formula for the amount A after a rate r compounded annually is applied over the value P for t years is:
[tex]A=P(1+r)^t[/tex]In this problem, we have:
P = 8000
r = 7.5% = 0.075
t = 10
So, using those values in the formula, we obtain:
[tex]\begin{gathered} A=8000(1+0.075)^{10} \\ \\ A=8000(1.075)^{10} \\ \\ A\cong16488.25 \end{gathered}[/tex]Therefore, rounded to the nearest cent, after 10 years he will owe $16,488.25.
