Question

How much would $500 invested at 6% interest compounded monthly be worth after 5 years? round your answer to the nearest cent.

Answer 1

Use this formula: A = P(1 + r/n)^nt, where A is the amount after interest (what you are solving for), P is the amount you invested originally, r is the rate at which it was invested in decimal form, n is the number of times the compounding occurs each year, t is the time in years it is invested. It would look like this: A = 500(1 + [.06/12])^12*5.  Do inside the parenthesis first to get 1 + .005 = 1.005.  Now raise that to the 60th power (12 times 5 is 60) to get 1.34558. Now multiply that by the 500 out front to get a total amount of $674.43

Answer 2

Answer- $674.43

Step-by-step explanation: