Question

9. You decide to invest $500 into a 4-year CD that pays 2.85% interest

compounded monthly.

Use the compound interest formula:A = P(1 + r/n) ^nt to give:

a. The future value in 4 years.
b. The interest gained in 4 years.

Answer 1

$560.30 & $60.30

Explanation:

A = $560.30

A = P + I where

P (principal) = $500.00

I (interest) = $60.30