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Noah invests $3,600 for two years.

The account pays 0.43% monthly compound interest. To the nearest cent, what's the total that will be in Noah's account after two years?

Sagot :

Lanuel

Answer:

Future value, A = $8444.16

Step-by-step explanation:

Given the following data;

Principal = $3,600

Time = 2 years

Number of times = 24

Interest rate = 0.43 %

To find the future value, we would use the compound interest formula;

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

Where;

  • A is the future value.
  • P is the principal or starting amount.
  • r is annual interest rate.
  • n is the number of times the interest is compounded in a year.
  • t is the number of years for the compound interest.

Substituting into the equation, we have;

[tex] A = 3600(1 + \frac{0.43}{24})^{24*2}[/tex]

[tex] A = 3600(1 + 0.01792)^{48}[/tex]

[tex] A = 3600(1.01792)^{48}[/tex]

[tex] A = 3600(2.3456)[/tex]

Future value, A = $8444.16

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