Question

Find the accumulated amount A, if the principal P is invested at an interest rate of r per year for t years. (ROUND ANSWER TO THE NEAREST CENT!!)

P = $180,000, r = 8%, t = 7,
compounded monthly

Answer 1

`\$314,535,97`

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=7\ years\\ P=\$180,000\\ r=8\%=8/100=0.08\\n=12`

substitute in the formula above

`A=180,000(1+(0.08)/(12))^(12*7)`

`A=180,000((12.08)/(12))^(84)`

`A=\$314,535,97`