Question

Betty invests $45,000 into a cd which has an interest rate of 6.3% that compounds monthly for a total of 5 years. how much will betty have after the 5 years? (rount to the nearest dollar)

Answer 1

$~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill &\ 45000\\ r=rate\to 6.3\%\to \frac{6.3}{100}\dotfill &0.063\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{monthly, thus twelve} \end{array}\dotfill &12\\ t=years\dotfill &5 \end{cases} \\\\\\ A=45000\left(1+\frac{0.063}{12}\right)^{12\cdot 5}\implies A=45000(1.00525)^{60}\implies A\approx 61611$