Answer:
Explanation:
Since the certificate pays 10% compounded every 2 months, the monthly interest rate is 10%/6 = 1.67%. The total number of compounding periods over the 13-year period is 13 years x 12 months/year x 1 compounding period/2 months = 78 compounding periods.
Using the formula for the future value of a present sum with compound interest:
FV = PV x (1 + r)^n
where FV is the future value, PV is the present value, r is the interest rate per period, and n is the total number of periods, we can find the value of the certificate on Maymay's 14th birthday:
FV = $12,000 x (1 + 0.0167)^78
FV = $12,000 x 2.6495
FV = $31,794.00
Therefore, the certificate will be worth $31,794.00 on Maymay's 14th birthday.
Hopes that helps :)