$600 principal earning 7%, compounded monthly, after 19 years
1 answer:
Answer:
$2,259.71
Step-by-step explanation:
(refer to attached)
the formula for compound interest is:
A = P [ 1 + (r/n) ] ^ (nt)
Where,
A = final amount
P = principal amount (given as $600)
r = interest rate = 7% = 0.07
n = 12 (because compounded monthly)
t = time elapsed (given as 19 years)
Substituting these into our equation,
A = P [ 1 + (r/n) ] ^ (nt)
A = 600 [ 1 + (0.07/12) ] ^ [(12)(19)]
A = 600 [ 1 + 0.005833 ] ^ 228
A = 600 [ 1.005833 ] ^ 228
A = 600 [ 3.7662 ]
A = $2,259.71
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