Show year 3 thru year 5
11/13/2024 03:39pm
Here's the yearly breakdown of the compound interest growth for years 3 through 5:
**Year 3:**
1. **Principal Amount**: $12,100 (the new future value from the end of Year 2)
2. **Interest Rate**: 10% or 0.1
3. **Number of Years**: 1
4. **Future Value Calculation**:
[ A = 12100(1 + 0.1)^1 ]
[ A = 12100(1.1)^1 ]
[ A = 12100 \times 1.1 ]
[ A = 13310 ]
So, at the end of the third year, your investment will grow to $13,310.
**Year 4:**
1. **Principal Amount**: $13,310 (the new future value from the end of Year 3)
2. **Interest Rate**: 10% or 0.1
3. **Number of Years**: 1
4. **Future Value Calculation**:
[ A = 13310(1 + 0.1)^1 ]
[ A = 13310(1.1)^1 ]
[ A = 13310 \times 1.1 ]
[ A = 14641 ]
So, at the end of the fourth year, your investment will grow to $14,641.
**Year 5:**
1. **Principal Amount**: $14,641 (the new future value from the end of Year 4)
2. **Interest Rate**: 10% or 0.1
3. **Number of Years**: 1
4. **Future Value Calculation**:
[ A = 14641(1 + 0.1)^1 ]
[ A = 14641(1.1)^1 ]
[ A = 14641 \times 1.1 ]
[ A = 16095.1 ]
So, at the end of the fifth year, your investment will grow to $16,095.1.
This breakdown shows how your investment grows each year due to the compound interest effect over the 5-year period.