Question

# You deposit \$10000 to open an investment account. The account will earn 8% interest. Two years...

You deposit \$10000 to open an investment account. The account will earn 8% interest. Two years after that deposit, you put \$2500 in the account. Two years after that, you withdrawal \$3000 from the account. How much money will be in the account at the end of year 6?

You deposit \$10000 to open an investment account and the account earns 8℅ interest.

The formula of simple interest is: Amount(A) = P(1+rt) , where P is the principal amount=\$10000, r is the rate of interest = 0.08 and t is the time period.

After 2 years, A = 10000(1+(0.08*2)) = \$11600

You deposit \$2500, and the total amount becomes \$(11600+2500)= \$14100, which works as principal for the next 2 years.

So, after another 2 years, A=14100[1+(0.08*2)] = \$ 16356

Now, you withdraw \$3000, and the amount becomes \$(16356-3000)= \$13356.

This is your principal for the last two years, which completes a total of 6 years.

So, after the last 2 years, A= 13356[1+(0.08*2)] = \$15492.96

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