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How μch interest would she earn at 1.2% compounded monthly for three years? Round to the nearest cent.

a. Varies based on principal amount
b. $36.72
c. $108.69
d. $12.50

User Walknotes
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1 Answer

3 votes

Final answer:

To calculate the interest earned at 1.2% compounded monthly for three years, we use the formula for compound interest. However, since the principal amount is not given, the interest earned varies based on the principal amount.

Step-by-step explanation:

To calculate the interest earned at 1.2% compounded monthly for three years, we can use the formula for compound interest:

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

Where:

A = the final amount

P = the principal amount

r = the interest rate (as a decimal)

n = the number of times interest is compounded per year

t = the number of years

In this case, the principal amount is not given, so we cannot determine the exact amount of interest earned. Therefore, the answer is: a. Varies based on principal amount.

User Joseph Lust
by
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