Nora deposited 30$ in an account earning 10% interest compounded annually. To the nearest cent, how much interest will she earn 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. $____
Q. Nora deposited 30$ in an account earning 10% interest compounded annually. To the nearest cent, how much interest will she earn 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 as a decimal, and time t. p=$30,r=10% or 0.10,t=3 years.
Use compound interest formula: Use the compound interest formulaB=p(1+r)t to calculate the balance after 3 years.B=30(1+0.10)3
Calculate inside parentheses: Calculate the amount inside the parentheses first. 1+0.10=1.10
Raise to power: Raise 1.10 to the power of 3.$1.103=1.331\)
Multiply principal amount: Multiply the principal amount by the result from step 4.B=30×1.331B=39.93
Subtract to find interest: Subtract the original principal from the balance to find the interest earned.Interest earned = B−pInterest earned = 39.93−30Interest earned = 9.93