3.5k views
5 votes
If Maggie invests 16,250 at a rate of 4.9%, compounded monthly, find the value of the investment after 7 years.

1 Answer

2 votes

Answer:

$22,883

Explanation:

Principal Amount ( P ) = $16250

Interest Rate ( r ) = 4.9% or 0.049( divide by 100)

Term ( t ) = 7

Compounded monthly( n ) = 12

Formula for Compound Interest:

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

A = Future value

Solution:

Substitute the given values of P, r, n and t to the formula for the compound interest.

A = $16250 ( 1 + 0.049/12)^(7)(12)

A = $16250 ( 1.004083333)^(84)

A = $16250 ( 1.408184955 )

A = $22,883

User Trcx
by
8.3k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories