Question

QUESTION 8

Find Future Value Using Compound Interest Formula:
You deposit $6,000 in an account earning 4% interest compounded monthly. How much will you have in the account in 5 years?
A $9,677.95
B. $6,100.67
C. $7,325.98
D. $7,200
QUESTION 9
Find Future Value Using Compound Interest Formula:
You deposit $5,000 in an account earning 5% interest compounded quarterly. How much will you have in the account in 10 years?
A $5,661.35
B. $7,500
C. $8,235.05
D. $8,218.10

Answer 1

8.) $7325.98

9.) $8218.10

Explanation:

Compounded Interest Rate Formula: A = P(1 + r/n)^nt

Simply plug in our known variables into the formula:

A = 6000(1 + 0.04/12)^60 = 7325.98

A = 5000(1 + 0.05/4)^40 = 8218.10