You deposit $600 in an account earning 2% interest compounded annually. How much will you have in the account in 20 years?

To calculate the amount of money in the account after 20 years, we use the formula for compound interest:

\[
A = P \left( 1 + \frac{r}{n} \right)^{nt}
\]

Where:
- $ A $ is the amount of money in the account after $ t $ years.
- $ P $ is the principal (initial amount), which is $600.
- $ r $ is the annual interest rate (as a decimal), so 2% becomes 0.02.
- $ n $ is the number of times the interest is compounded per year. Since it's compounded annually, $ n = 1 $.
- $ t $ is the time the money is invested, which is 20 years.

Plugging in the values:

\[
A = 600 \left( 1 + \frac{0.02}{1} \right)^{1 \times 20} = 600 \left( 1.02 \right)^{20}
\]

Now, calculating:

\[
A = 600 \times 1.485947 = 891.57
\]

So, the amount in the account after 20 years will be approximately **$891.57**.

Would you like further details or have any questions about the calculation?

Here are 5 related questions:
1. What if the interest was compounded quarterly instead of annually?
2. How would the final amount change if the interest rate was 5%?
3. What is the difference between simple and compound interest in this scenario?
4. How much interest will be earned after 10 years instead of 20?
5. If $1000 was deposited, how much would it be worth in 20 years at 2% interest?

**Tip:** Always ensure that you convert the interest rate to decimal form when using it in formulas.

Find out how to calculate compound interest on $600 with a 2% annual interest rate over 20 years. This problem demonstrates the compound interest formula, covering key concepts in exponential growth and finance. Suitable for students in Grades 9-12.

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