How much money invested at 3% compounded monthly for 3 years will yield $520?
1 answer:
Answer:
Step-by-step explanation:
Use this formula:
where A(t) is the amount after the compounding is done, P is the initial investment (our unknown), r is the interest rate in decimal form, n is the number of compoundings per year, and t is the time in years. Filling in:
and simplifying that a bit:
and a bit more:
and even bit more:
520 = P(1.094551401) and divide to get
P = $475.30
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<u>Answer:</u>
The money will gavin have after 5 years is 1616.59$
<u>Explanation:</u>
We know that compound interest is given by
Where A = final amount
P = Principal amount = $1500 (given)
r = interest rate = 1.5% = 0.015
n = no. of times interest applied per time period = given quarterly = 4
t = time period = 5 years
So,
= 1616.59$ which is the money will gavin have after 5 years