Subjects finance

Compound Interest E81C8C

Step-by-step solutions with LaTeX - clean, fast, and student-friendly.

Use the AI math solver

1. **State the problem:** Aiman deposited 6000 into a savings account with 7% annual compound interest. We need to find the future value after 6 years. 2. **Formula used:** The formula for compound interest is $$A = P \left(1 + \frac{r}{n}\right)^{nt}$$ where: - $A$ is the amount of money accumulated after $t$ years, including interest. - $P$ is the principal amount (initial deposit). - $r$ is the annual interest rate (decimal). - $n$ is the number of times interest is compounded per year. - $t$ is the number of years. 3. **Apply values:** Here, $P = 6000$, $r = 0.07$, $n = 1$ (compounded annually), and $t = 6$. 4. **Calculate:** $$A = 6000 \left(1 + \frac{0.07}{1}\right)^{1 \times 6} = 6000 \times (1.07)^6$$ 5. **Evaluate:** Calculate $(1.07)^6$: $$1.07^6 \approx 1.5007$$ 6. **Final amount:** $$A = 6000 \times 1.5007 = 9004.2$$ So, the future value of the investment after 6 years is approximately 9004.2.