A cellular phone company charges $37 a month plus a $19 activation fee. How much would it cost for 7 months of service?
2 answers:
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Answer:
$87.23.
Step-by-step explanation:
We are asked to find the amount after 4 years compounded monthly at the rate of 2.8% APR.
We will use compound interest formula to solve our given problem.
, where,
A = Final amount after T years,
P = Principal amount,
r = Interest rate in decimal form,
n = Number of times interest is compounded per year.
T = Time in years.
Let us convert our given rate in decimal form.
Upon substituting our given values in compound interest formula we will get,
Therefore, we will have $87.23 in the account after 4 years.