Question

Find the future value of $3000 is invested for 5 years at 8% compounded annually

Answer 1

The future value is
`\$4,407.98}`

Explanation:

we know that

The compound interest formula is equal to

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

where

A is the Final Investment Value or Future 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=5\ years\\ P=\$3,000\\ r=8\$=8/100=0.08\\n=1`

substitute in the formula above

`A=3,000(1+(0.08)/(1))^(1*5)`

`A=3,000(1.08)^(5)`

`A=\$4,407.98}`