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A principal of $500 is invested in an account at 7% per year compounded annually. What is the total amount of money in the account after 5 years?

Answer 1

#500(1+0.07/1) ^5 = 701 #

The compound interest formula is below.

The principal is #$500#, the interest rate is #7%# expressed as #0.07# as a decimal. It is compounded annually (once a year) and it was compounded #5# times because it was compounded annually for #5# years.

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Answer from HIX Tutor

When evaluating a one-sided limit, you need to be careful when a quantity is approaching zero since its sign is different depending on which way it is approaching zero from. Let us look at some examples.

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