Question

Emma puts $1000 in a savings account that pays 4% interest, compounded monthly. How much money will be in the account 3 years later if she makes no more deposits?

a. $1,127.27
b. $1,124.86
c. $1,120.00
d. $1,010.03

Answer 1

a

Explanation:

Answer 2

Option A.
`\$1,127.27`

Explanation:

we know that

The compound interest formula is equal to

`A=P(1+(r)/(n))^(nt)`

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest in decimal

t is Number of Time Periods

n is the number of times interest is compounded per year

in this problem we have

`t=3\ years\\ P=\$1,000\\ r=0.04\\n=12`

substitute in the formula above

`A=\$1,000(1+(0.04)/(12))^(12*3)=\$1,127.27`