Answer:
Interest: $5400, account value: $10400
Step-by-step explanation:
To find the final value of the account of Camden, we can use the formula for the simple interest rate:
[tex]I=Prt[/tex]
where
I is the interest
P is the principal
r is the interest rate
t is the time
In this problem:
P = $5000 is the principal amount
r = 6% = 0.06 is interest rate
t = 18 y is the time
Therefore, the interest accumulated after 18 years is
[tex]I=(5000)(0.06)(18)=\$5400[/tex]
And so, the total value of the account after 18 years is:
[tex]P' = P+I = 5000+5400 = \$10400[/tex]
