Lisa opened a savings account and deposited 800.00 as principal. The account earns 5% interest, compounded annually. What is the balance after 5 years?

Solution

Solution

Amount : 1021.03

Solution steps

Translate the problem into an equation:

A = 800 (1 + \frac{0.05}{1})^{1 \cdot 5}

800 (1 + \frac{0.05}{1})^{1 \cdot 5} = 1021.02525

Round to the nearest hundredth:

1021.03

Amount : 1021.03

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