Answer:
The future value of $600 would be $690.
Step by step explanation:
To calculate the future value of $600 after 5 years with a 3% interest rate and monthly simple interest payments, we can use a formula:
Future Value = Principal (1 + Interest Rate * Time)
Here's how it works:
1. First, convert the annual interest rate to a monthly rate. In this case, 3% per year becomes 0.03 divided by 12 (months), which is approximately 0.0025.
2. Next, multiply the monthly interest rate by the number of months (5 years x 12 months/year = 60 months) to get the total time in months, which is 0.0025 * 60 = 0.15.
3. Add 1 to the result from step 2: 1 + 0.15 = 1.15.
4. Finally, multiply the principal amount ($600) by the result from step 3 to find the future value: $600 * 1.15 = $690.
So, after 5 years with monthly simple interest payments at a 3% interest rate, the future value of $600 would be $690.