How much money would you have if you invested $3000 at 6.25% annual interest, compounded daily for 2 years?

Question

asked Dec 23, 2022 125k views

1 Answer

Emre Akman · Answer 1 · 2022-12-28T14:13:29+0000

Answer:

$A\simeq3399.41$

Explanation:

The amount formula in compound interest is:

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

where:

P = principal amount

r = annual interest

n = number of compounding periods

t = number of years

We already know that:

P = $3000

$r = 6.25\% = (6.25\%)/(100\%)=0.0625$

t = 2

n = 365

Then,

$A=3000(1+(0.0625)/(365) )^((365)(2))\\\\A=3000(1+(0.0625)/(365) )^(730)\\\\A=3399.408982\\\\A\simeq3399.41$