Question

Annabella wants to make the most economical decision so she chose the 3-year car loan so that after the loan is paid off to be able to invest in a structured saving account if Anabella put $200 into a saving account each month with an annual interest rate of 3.2% interest compounded monthly how much money would she have in her account after 2 years ​

Answer 1

Answer:

• Annabella will save $4950.11 after 2 years.

Step-by-step explanation:

Given

• Periodic payment P = $200,
• Period t = 2 years,
• Number of compounds, monthly n = 12,
• Interest rate, r = 3.2% = 0.032.

To find

• Future value of saving, F

Solution

Use periodic compound formula:

$F=P\cfrac{(1+r/n)^{nt}-1}{r/n}$

Substitute the values and calculate:

$F=200\cfrac{(1+0.032/12)^{12*2}-1}{0.032/12} =4950.12$     rounded

Answer 2

Step-by-step explanation:

Given

• P = $200,
• t = 2 years,
• n = 12,
• $\sf \: r = 3.2\% = \frac{3.2}{100} = 0.032$

To find

• Future value of saving

Solution

Use periodic compound formula:

$\sf \: F=P\cfrac{(1+ \frac{r}{n})^{nt}-1}{\frac{r}{n}}$

Substitute the values and calculate:

$\sf \: F=200\cfrac{(1+ \frac{0.032}{12})^{12 \times 2}-1}{\frac{0.032}{12}}$

$\sf \: F=200\cfrac{( \frac{ 12 + 0.032}{12})^{24}-1}{\frac{0.032}{12}}$

$\sf \: F=200\cfrac{( {11.002 }{})^{24}-1}{0.002}$

$\sf \: F=200 \times 24.7506$

$\sf \: F=4950.12rounded$