Question

Mark is investing $8,000 in an account paying 5.5% interest compounded monthly.

What will Mark's account balance be in 7 years?

Answer 1

The formula is F = P(1 + interest percent)^n

Here,

p =8000 dollar

interest percent =5.5% = (5.5/12)/100 =0.004583 (compounded monthly)

n =7 x 12 =84 (compounded monthly)

=> Mark's account balance after 7 years

F = 8000*(1+0.004583)^84 =11746.2503 dollar