Question

You deposit $2,400 in an account that earns 1.9% annual interest. Find

the balance after 3 years if the interest is compounded monthly.
Remember this is $ so you round to 2 decimal places unless told to do
differently.

Answer 1

$2471.53

Explanation:

Use the compound amount formula:

A = P(1 + r/n)^(nt), where n is the number of compoundings per year

Here,

A = ($2,400)(1 + 0.019/12)^(12·3), or

($2,400)(1.0015)^36

= ($2,400)(1.026) =

= $2471.53