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2 votes
Nancy has $4,111 in an account that pays 3.07% interest compounded monthly. What is her

ending balance after two years?
M
17
.

User Seeliang
by
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1 Answer

4 votes

Answer:

Ending balance after 2 years=$4,370.98

Explanation:

To calculate her ending balance after two years, we need to get the express the total amount as follows;

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

where;

A=Total future value of the initial investment

P=Initial value of the investment

r=Annual interest rate

n=number times the interest rate is compounded annually

t=number of years of the investment

In our case;

P=$4,111

r=3.07%=3.07/100=0.0307

n=12

t=2 years

Replacing;

A=4,111(1+0.0307/12)^(12×2)

A=4,111(1.0026)^24

A=4,370.98

Ending balance after 2 years=$4,370.98

User Jtht
by
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