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Simon deposits $400 in an account that pays 3% interest compounded annually. What is the balance of Simon’s account at the end of 2 years?

424.36
524.56
545.36
456.36

Correct Answer: 424.36

Explanation:

I=Prt

I=12

Balance = P +Prt

412

Find the balance at the end of the second year.

I = Prt=12.36

Balance =P + Prt

424.36

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