At the beginning of each year, Joe invests $10,000 in his retirement fund. The fund gives 10% interest, compounded annually. At the end of the third year, how much money will be in Joe's fund? Help, Please?

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Answer 1 · 2018-03-23T19:23:13

#$13,310#

The formula for compound interest is given as:

#FV=PV(1+r/n)^(nt)#

Where:

#FV="future value"#

#PV="principal value"#

#r="interest rate as a decimal"#

#n="compounding period"#

#t="time in years"#

From the information given:

#PV=10000#

#r=10/100=0.1#

#n=1#

#t=3#

Putting these in the formula:

#FV=10000(1+0.1/1)^(3)#

#FV=10000(1.1)^(3)=13310#

#$13,310#