Answer:
$2,247.20
Step-by-step explanation:
Lets use the compound interest to solve this problem:
[tex]A=P(1+\frac{r}{n} )^{nt}[/tex]
P = initial balance
r = interest rate (decimal)
n = number of times compounded annually
t = time
First, change 6% into a decimal:
6% -> [tex]\frac{6}{100}[/tex] -> 0.06
Now, plug the values into the equation:
[tex]A=2,000(1+\frac{0.06}{1})^{1(2)}[/tex]
[tex]A=2,247.20[/tex]
The balance after 2 years will be $2,247.20
