Question

PLEASE HELP ME !!

If you put $375 into a savings account that pays 6% interest compounded monthly, how much money would you have in your account after 3 years?


How much did you earn in interest?

Answer 1

$448.76

$73.76

Explanation:

We are to calculate the future value with monthly compounding

The formula for calculating future value:

FV = P (1 + r/m)^mn

FV = Future value

P = Present value

R = interest rate

m = number of compounding

N = number of years

$375 x ( 1 + 0.06/12)^12 x 3

$375 x (1.005)^36 = $448.76

Interest earned = future value - amount saved

$448.76 - $375 = $73.76