Question

An account earning interest at a rate of 4% compounded monthly has a principal of $ 500,000 . If no more deposits or withdrawals are made , how much money will be in the account after five years?

Answer 1

$610,498.30

Explanation:

P = C (1 + r/n)^nt

4% = 0.04

P = 500 000(1+0.04/12)^(12*5)

P = 500 000 (1.003333)^60

P = 500 000 (1.220997)

P = $610 498.296971