Question

I plan on opening a savings account with $800 and leaving it in the account for 4 years. If the bank is going to pay me an interest rate of 5%, how much money will I have in the account at the end of 4 years? A. $2,400 B. $1,600 C. $960 D. $160

Answer 1

The correct answer is C.

Explanation:

Percent to Decimal conversion:

`5/100=0.05`

Using the decimal value with starting money
`0.05*800=40`

Multiply 40 by 4 years
`40*4=160`

Adding the amount interest earned over 4 years with starting amount
`160+800=960`