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Mykala has deposited $5,000 in a bank for 6 years at the interest rate of 5% compounded annually. How much money will she receive at the end of the six years?Mykala will receive $



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Solution:

Given:

[tex]\begin{gathered} P=\text{ \$}5000 \\ t=6yrs \\ r=5\text{ \%} \end{gathered}[/tex]

Using the compound interest formula;

[tex]A=P(1+r)^t[/tex]

Hence,

[tex]\begin{gathered} A=5000(1+\frac{5}{100})^6 \\ A=5000(1.05)^6 \\ A=\text{ \$}6700.48 \end{gathered}[/tex]

Therefore, the amount she will receive at the end of six years is $6700.48

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