Answer:
Step-by-step explanation:
Initial amount invested in the account is $200 This means that the principal, P = $200
It was compounded annually. This means that it was compounded once in a year. So
n = 1
The rate at which the principal was compounded is 7%. So
r = 7/100 = 0.07
It was compounded for 5 years. So
t = 5
The formula for compound interest is
A = P(1+r/n)^nt
A = total amount in the account at the end of t years. Therefore
A = 200 (1+0.07/1)^1×5
A = 200(1.07)^5 = 200 × 1.402552
A = $280.51
