Answer: $5661 will be in the account 10 years later
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 = 5000
r = 1.25% = 1.25/100 = 0.0125
n = 1 because it was compounded once in a year.
t = 10 years
Therefore,
A = 5000(1 + 0.0125/1)^1 × 10
A = 5000(1.0125)^10
A = 5000(1.0125)^10
A = $5661
