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boyakko [2]
4 years ago
8

Colton bought a CD for $760 that earns a 3.8% APR and is compounded monthly. The CD matures in 3 years. How much will this CD be

worth at maturity
Mathematics
1 answer:
4vir4ik [10]4 years ago
8 0

Answer:

  $851.62

Step-by-step explanation:

The value multiplier wll be ...

  (1 +r/n)^(nt)

where r is the annual interest rate (3.8%), n is the number of compoundings per year (12), and t is the number of years (3). Filling in these numbers, we see the ending value will be ...

  A = $760(1 +.038/12)^(12·3) = $760(1.0031667^36) = $851.62

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