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A $3,000 deposit for 66 months compounded at an annual interest rate of 1.6%. What is the interest and the account balance at the end of the 66 months

Answer :

sqdancefan

Answer:

  • interest: $275.77
  • balance: $3,275.77

Step-by-step explanation:

The account value is given by the compound interest formula:

  A = P(1 +r/12)^n

Principal P invested at annual rate r compounded monthly for n months.

__

Using your parameters, the account balance would be ...

  A = $3000(1 +0.016/12)^66 = $3275.77 . . . account balance

The interest is the difference between this balance and the original investment amount:

  interest = $3000 -3275.77 = $275.77 . . . interest

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