Question

Lucia rivera invested $9,000 at 3.75 percent compounded monthly in an account that matures in 4 years. the amount per $1.00 is 1.161563. what is the interest earned at maturity for the account?

Answer 1

The interest earned at maturity for Lucia Rivera's account is $1,578.77.

Step-by-step explanation:

To calculate the interest earned at maturity for Lucia Rivera's account, we can use the formula:

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

where:

• A is the total amount at maturity
• P is the principal (initial investment)
• r is the annual interest rate (in decimal form)
• n is the number of times interest is compounded per year
• t is the number of years

In this case, P = $9,000, r = 3.75% or 0.0375, n = 12 (since interest is compounded monthly), and t = 4 years. Plugging in these values, we get:

A = $9,000 (1 + 0.0375/12)^(12*4) = $9,000 (1.003125)^48 = $10,578.77

Therefore, the interest earned at maturity for the account is $10,578.77 - $9,000 = $1,578.77.