Ben put $6,500 into a savings account that earns 2.5% interest each year. How much interest will he earn after 6 years in the savings account?

$1,038

Step-by-step explanation:

the equation for annual compound interest is y=p(1±r)^t, where p is the principal (starting amount), r is the rate (as a decimal), and t is the number of years (time).

2.5% as a decimal is 0.025

We will add that to 1, because when we earn interest, we are gaining money.

So we will substitute our given numbers into the equation:

y=6500(1.025)^6

solve:

y=$7,5638 (rounded)

That's the total amount he earned (principal + interest). To find out how much interest he earned over those 6 years, subtract our new amount from our starting amount

75638-6500

$1,038

So he made $1,038 in interest

answer

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step-by-step explanation: