Question

You have $3,000 in savings account that pays 2.5% interest, compounded monthly. What is future value in 4 years?

Answer 1

`\$4453.52`

Explanation:

Principal amount (P) = $3,000

Rate of interest (R) = 2.5%

Time period (T) = 4 years

Future value in 4 years =
`P(1+(R)/(100))^(4T)`

Put
`P=3000\,,\,R=2.5\,,\,T=4`

Therefore,

Future value in 4 years =
`3000(1+(2.5)/(100))^(4(4))=3000(1.025)^(16)=\$4453.52`