Which of the following formulas would you choose to calculate the future balance on an account that earns compound interest?
FV=PV×(1 + i)nFV=PV×(1 + i)^n (formula)
On Kevin’s first birthday, his parents deposited $2,500 into a savings account that earns a fixed rate of 7.50% and compounds interest annually. How much money will Kevin’s account have accumulated by his 19th birthday? (Hint: Round your answer to the nearest dollar.)
(a) $9,879
(b) $4,793
(c) $9,190
(d) $25,000