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Samuel invests £45 500 in an account that pays 4.5% compound interest per annum for the five years, then 3.5% . Work out how much money Samuel will have in his account in 13 years.

Answer :

Answer:

$74,664.76

Step-by-step explanation:

We are to determine the future value of  £45 500

The formula for calculating future value:

FV = P (1 + r)^n

FV = Future value  

P = Present value  

R = interest rate  

N = number of years

Future value for the first 5 years =  £45 500 x (1 + 0.045)^5 = $56,701.28

Future value for the remaining 8 years = $56,701.28 x ( 1 + 0.035)^8 = $74,664.76

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