Questions: 3. (5 points) Find the future value of the given investment. 3,620 at 2.75% for eight years.

Solution Steps

The principal amount \( P \) is \$3,620, the annual interest rate \( r \) is 2.75%, and the time \( t \) is 8 years.

The interest rate \( r = 2.75\% \) is converted to decimal form by dividing by 100:
\[ r = \frac{2.75}{100} = 0.0275 \]

The future value \( A \) is calculated using the simple interest formula:
\[ A = P(1 + rt) \]
Substitute the given values:
\[ A = 3620(1 + 0.0275 \times 8) \]
\[ A = 3620(1 + 0.22) \]
\[ A = 3620 \times 1.22 \]
\[ A = 4416.4 \]

The future value of the investment is \$4,416.40.

Final Answer