A principal or 6000 is invested in an account paying an annual percentage rate of 4% . Find the amount in the account after 5 years if the account is compounded.

the amount in the account after 5 years is $7300

Step-by-step explanation:

We would apply the formula for determining compound interest which is expressed as

A = P(1+r/n)^nt

Where

A = total amount in the account at the end of t years

r represents the interest rate.

n represents the periodic interval at which it was compounded.

P represents the principal or initial amount deposited

From the information given,

P = 6000

r = 4% = 4/100 = 0.04

n = 1 because it was compounded once in a year.

t = 5 years

Therefore,.

A = 6000(1 + 0.04/1)^1 × 5

A = 6000(1.04)^5

A = $7300