Question

Use the problem below to answer the questions.

Malik invested $13,000 for 6 years at 3.5%. How much interest will he receive?

Find the compound interest for the situation. Use the compound interest formula. Round answers to the nearest hundredth. Include appropriate units in final answers. Use a calculator if needed.

Did Malik gain or lose money? How much?

lose; $250.32

lose; $377.68

lose; $1,109.15

lose; $809.38

Answer 1

[AI-generated answer — Bot GPT 3.5]

To calculate the compound interest, we can use the formula:

A = P(1 + r/n)^(nt)

Where:
A = the future value of the investment/loan, including interest
P = the principal investment amount (initial deposit or loan amount) = $13,000
r = annual interest rate (decimal) = 3.5% = 0.035
n = number of times that interest is compounded per year = 1 (compounded annually)
t = time the money is invested/borrowed for, in years = 6

Now we can substitute these values into the formula and calculate:

A = 13000(1 + 0.035/1)^(1*6)
A = 13000(1 + 0.035)^6
A = 13000(1.035)^6
A = 13000(1.218753)
A = 15841.79

Now we can subtract the initial investment amount to find the interest earned:

Interest = $15,841.79 - $13,000 = $2,841.79

Therefore, Malik would receive $2,841.79 in interest.

Since Malik gained money, none of the options provided are correct.