00:03
All right, we are placing $7 ,800 into an account that earns 6 .5 % annual interest.
00:12
And we want to know how much is going to be in there after 29 years.
00:16
So make sure that you know your formulas for these things.
00:19
For one like this, we have a shortened version of the formula, but i'll give you the more detailed version of it just to make sure.
00:26
To find the amount, it's going to be the principle, how much we start with, times one plus the rate, divided by n raised to the n times t.
00:37
So that's the formula that we're really using here.
00:40
Now, because it's only annual interest, this n talks about how many times it is compounded per year.
00:49
So if it's annual interest, it's just being compounded one time per year.
00:55
So you may have just been given a slightly simplified version of this formula.
01:00
So then it would just look like one plus, well, if it's r over 1, it's 1 plus r, raised to the 1 times t or just raised to the t.
01:08
So this is the simplified version since it is just annual interest.
01:13
All right.
01:14
But now we can use our formula and go ahead and figure out how much is there after 29 years.
01:20
So for our formula, it's going to be a is equal to.
01:24
And p is our principle.
01:25
Well, that's how much we're actually investing.
01:27
So that's going to be $7 ,800 times one plus.
01:33
Now the rate, don't use 6 .5...