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Find the amount Erica owes at the end of 6 years if ​$6200 is loaned to her at a rate of 4 compounded monthly?

User Pycruft
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Final answer:

The amount Erica owes at the end of 6 years is approximately $7294.22.

Step-by-step explanation:

To find the amount Erica owes at the end of 6 years, we can use the formula for compound interest: A = P(1 + r/n)^(nt), where A is the amount owed, P is the principal (loaned amount), r is the annual interest rate (in decimal form), n is the number of times the interest is compounded per year, and t is the number of years.

In this case, P = $6200, r = 4% or 0.04, and n = 12 (compounded monthly). Substituting these values into the formula, we get A = $6200(1 + 0.04/12)^(12*6) = $6200(1 + 0.00333)^(72) = $6200(1.00333)^72.

Calculating this expression, we find that the amount Erica owes at the end of 6 years is approximately $7294.22.

User Aheuermann
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