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30 January, 01:41

Find the value of $825 invested at 5% with interest compounded twelve times a year for 9 years

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  1. 30 January, 01:52
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    We assume it is future value we're looking for. Present value is $825.

    Future value, F, can be calculated using the compound interest formula.

    P=present value = $825

    i=interest rate per month = 0.05/12

    n=number of months = 12*9 = 108

    F=value after 9 years=P (1+i) ^n=825 (1+0.05/12) ^108=1292.65 (nearest cent)
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