You have $500 in a savings account that earns 2% interest, compounded each year. How much would you have after five years?

If you have $500 in your account, at 2% interest, you'll have $510 at the end of year one. As the interest is compounded each year, you'll have $510 x 2% at the end of year two ($520.20). Keep this up, and by the end of year 5, you'll bank $552.03.

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