In: Finance
If you invest $1,000 today into a deposit account earning 5.75% interest compounded monthly, how much would your investment be worth in 10 years?
A/c balance after 10 years | PV×(1+r)^n | |
Here, | ||
1 | Interest rate per annum | 5.75% |
2 | Number of years | 10 |
3 | Number of compoundings per per annum | 12 |
1÷3 | Interest rate per period ( r) | 0.48% |
2×3 | Number of periods (n) | 120 |
Present value (PV) | $ 1,000 | |
A/c balance after 10 years | $ 1,774.69 | |
1000*(1+0.48%)^120 |