Answer:
Value of investment for Sierra after two years will be $5100.5
Step-by-step explanation:
Principal Amount P =$5000
Interest rate r = 1% = 0.01
Time t = 2 years
Compounded annually n = 1
We need to find future amount A
The formula used is: [tex]A=P(1+\frac{r}{n})^{nt}[/tex]
Putting values and finding A
[tex]A=P(1+\frac{r}{n})^{nt}\\A=5000(1+\frac{0.01}{1})^{1*2}\\A=5000(1+0.01)^{2} \\A=5000(1.01)^{2}\\A=5000(1.0201)\\A=5100.5[/tex]
So, Value of investment for Sierra after two years will be $5100.5
