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Martin opened a savings account and deposited 2,000.00. The account earns 9% interest, compounded annually. If he wants to use the money to buy a new bicycle in 3 years, how much will he be able to spend on the bike?

Solution

Martin opened a savings account and deposited 2, 000.00. The account earns 9% interest, compounded annually. If he wants to use the money to buy a new bicycle in 3 years, how much will he be able to spend on the bike?

Solution

Amount : 2590.058

Solution steps

Translate the problem into an equation:

A = 2000 (1 + \frac{0.09}{1})^{1 \cdot 3}

2000 (1 + \frac{0.09}{1})^{1 \cdot 3} = 2590.058

Amount : 2590.058

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