Franco has 80$ in an account. The interest rate is 5% compounded annually. To the nearest cent, how much will he have in 3 years? Use the formula B=p(1+r)t, where B is the balance (final amount), p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years. $____
Q. Franco has 80$ in an account. The interest rate is 5% compounded annually. To the nearest cent, how much will he have in 3 years? Use the formula B=p(1+r)t, where B is the balance (final amount), p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years. $____
Identify values: Identify the principal amount p, interest rate r, and time t.Principal p = $80Interest rate r = or $0.05 as a decimalTime t = 3\) years
Plug into formula: Plug the values into the compound interest formula B=p(1+r)t.B=80(1+0.05)3
Calculate inside parentheses: Calculate the value inside the parentheses first. 1+0.05=1.05
Raise to power: Raise 1.05 to the power of 3. (1.05)3=1.157625
Multiply principal amount: Multiply the principal amount by the result from step 4.B=80×1.157625B=92.61