What is the balance on a deposit of $1,150 that earns 9% interest compounded annually for 2 years?
Answer (2)
Step One: Calculate interest.
1150 ∗ 0.09 = 103.5
Step Two: Calculate the amount at the end of the first year.
1150 + 103.5 = 1253.5
Step Three: Calculate the amount at the end of the second year. This will be your final answer.
1253.5 + 103.5 = 1357
$1357 balance
The balance on a deposit of $1,150 that earns 9% interest compounded annually for 2 years is approximately $1,367.32. This is derived by calculating the amount after each compounding period. The final result takes into account the interest compounded annually over those 2 years.
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