You want to save for a brand-new car. You put the $5,000 your Grandma gave you when you graduated in an account that pays 6% interest and is compounded monthly. How much will you have at the end of five years?

Question

Rhett Allison

Mathematics

26 October, 18:18

You want to save for a brand-new car. You put the $5,000 your Grandma gave you when you graduated in an account that pays 6% interest and is compounded monthly. How much will you have at the end of five years?

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Answers (1)

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Darwin Montoya · Answer 1

Balance at the end of 5 years: $7,346.64

Step-by-step explanation:

A = P (1+r/n) nt

Principal: 5,000

Rate of Interest: 6%

Number of Times, Compounded In A Year: 12

Year: 5 years

A = 5,000 (1+1.06/12) ^5

A = 5,000 (1.08) ^5

A = 7346.64