Question

Perry opened a savings account and deposited 600.00 as principal the account earns 1%interest compounded monthly what is the balance after 3 years

Answer 1

Let's begin by listing out the information given to us:

Principal (P) = 600, interest rate (r) = 1% = 0.01 * 12 = 0.12, componded monthly (n) = 12, time (t) = 3

The formula for compound interest is given by?

`\begin{gathered} A=P(1+(r)/(n))^(nt) \\ \end{gathered}`

We proceed to substitute the values of the variables into the equation, we have:

`\begin{gathered} A=600(1+(0.12)/(12))^(12\cdot3)=600(1+0.01)^(36) \\ A=600(1.01^(36))=858.46 \\ \therefore A=\text{ \$}858.46 \end{gathered}`