Question

1. You deposit $4000 in an account earning 5% interest compounded monthly. How much will you have in the account in 5 years?

2. Find the time required for an investment of 5000 dollars to grow to 6500 dollars at an interest rate of 7.5 percent per year, compounded quarterly.
Round your answer to two decimal places
Your answer is t=____ years.

3. You deposit $2000 in an account earning 5% interest compounded monthly. How much will you have in the account in 15 years?

Answer 1

• A = the final value of the investment/loan, including interest
• P = the principal investment amount (the initial deposit or loan amount)
• r = the annual interest rate (decimal)
• n = the number of times that interest is compounded per unit t
• t = the time the money is invested or borrowed for
• R=r*100

then,

1. We have,

P=$4000

R=5%

r=0.05

n=12

t=5 years

A=?

Thus we will have $5133.43 in bank account in 5 years.

2. P=$5000

A=$6500

R=7.5%

r=0.075

n=3

t=?

t=3.54 years (rounded upto two decimals)

3. We have,

P=$2000

R=5%

r=0.05

n=12

t=15 years

A=?

Thus we will have $4227.41 in bank account in 15 years.

Hope this helps!