Question

Jackson deposited $160 a month into an account earning 7.2% compounded monthly for 12 years. He left the accumulated amount for another 3 years at the same interest rate. How much total interest did he earn?_______________Round to the nearest cent

Answer 1

`\begin{gathered} P=\text{ \$160} \\ i=7.2\text{ \%=0.072} \\ t1=12\text{ years} \\ t2=3\text{ years} \\ F=\text{?} \\ F=P(1+i)^t \\ t=t1+t2 \\ t=12+3 \\ t=15 \\ F=160(1+0.072)^(15) \\ F=160(1.072)^(15) \\ F=453.98 \\ \text{Interest}=453.98-160 \\ \text{Interest}=293.98 \\ He\text{ earned \$293.98} \end{gathered}`