The future value of the original investment is $12,968.71
Step-by-step explanation:
The formula for compound interest, including principal sum is
[tex]A=P(1+\frac{r}{n})^{nt}[/tex] , where:
Jesse is making a $5,000 investment that will be compounded annually at 10% for the next 10 years.
We need to find the future value of the original investment
∵ Jesse is making a $5,000 investment
∴ P = 5000
∵ The interest rate is 10%
∴ r = 10% = 10 ÷ 100 = 0.1
∵ The interest is compounded annually
∴ n = 1
∵The time of investment is 10 years
∴ t = 10
- Substitute these values in the formula above
∵ [tex]A=5000(1+\frac{0.1}{1})^{(1)(10)}[/tex]
∴ [tex]A=5000(1+0.1)^{10}[/tex]
∴ [tex]A=5000(1.1)^{10}[/tex]
∴ A = 12968.71
∴ The future value is $12,968.71
The future value of the original investment is $12,968.71
Learn more:
You can learn more about compounded interest in brainly.com/question/2514241
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