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Angela deposits $5000 into an account with an APR of 2.2 % for 8 years. Find the future value of the account if interest is compounded monthly. Round your answer to the nearest hundredth, if necessary.

User Ghostrydr
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Final answer:

The future value of Angela's $5000 deposit at an APR of 2.2% compounded monthly for 8 years is approximately $5986.13.

Step-by-step explanation:

To find the future value of an account with compounded interest, you use the formula Future Value = Principal x (1 + (APR/n))^(nt). Here, APR is the annual percentage rate, n is the number of times interest is compounded per year, and t is the time in years. Angela deposits $5000 at an APR of 2.2%, which is compounded monthly (n=12) for 8 years.

By substituting the given values into the formula, we have Future Value = 5000 x (1 + (0.022/12))^(12*8). First, we'll calculate the parentheses: 1 + (0.022/12) = 1.001833..., and then raise it to the power of (12*8) = 96, which gives us approximately 1.197225853. Multiplying this by 5000 gives us a future value of approximately $5986.13.

Therefore, Angela's investment will grow to $5986.13 at the end of 8 years with monthly compounding at an APR of 2.2%. The future value of Angela's $5000 deposit at an APR of 2.2% compounded monthly for 8 years is approximately $5986.13.

User Fricke
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