Question

Brooke deposits $1,200 into a savings account that pays 5.2% interest compounded monthly. What will be the alance after 4 years. Round to the nearest cent. No dollar sign in the answer.

Answer 1

The balance after 4 years will be $1,468.08.

Step-by-step explanation:

To calculate the balance of an account after a certain number of years with compound interest, we can use the formula A = P(1 + r/n)^(nt), where A is the final balance, P is the principal amount (initial deposit), r is the annual interest rate (as a decimal), n is the number of times interest is compounded per year, and t is the number of years.

In this case, Brooke deposits $1,200 with an interest rate of 5.2% compounded monthly. So, we have P = $1,200, r = 5.2% = 0.052, n = 12, and t = 4.

Plugging in these values into the formula, we get A = 1200(1 + 0.052/12)^(12*4) = $1,468.08. Therefore, the balance after 4 years will be $1,468.08.