Answer:
$108.90
Step-by-step explanation:
To calculate the amount of money Allen will have in 2 years with 10% interest compounded annually, we can use the formula for compound interest:
[tex]\Large\boxed{\boxed{\sf A = P \times \left(1 + \dfrac{r}{100}\right)^n}} [/tex]
Where:
- [tex]\sf A [/tex] is the amount of money accumulated after [tex]\sf n[/tex] years, including interest.
- [tex]\sf P [/tex] is the principal amount (the initial amount of money).
- [tex]\sf r [/tex] is the annual interest rate (in percentage).
- [tex]\sf n [/tex] is the number of years the money is invested for.
Given:
- [tex]\sf P = \$90 [/tex]
- [tex]\sf r = 10\% [/tex]
- [tex]\sf n = 2 [/tex] years
Substitute these values into the formula:
[tex]\sf A = 90 \times \left(1 + \dfrac{10}{100}\right)^2 [/tex]
[tex]\sf A = 90 \times \left(1 + 0.1\right)^2 [/tex]
[tex]\sf A = 90 \times (1.1)^2 [/tex]
[tex]\sf A = 90 \times 1.21 [/tex]
[tex]\sf A = \$ 108.90 \textsf{(in nearest cent)}[/tex]
So, Allen will have approximately $108.90 in the savings account after 2 years.
