Question

Katelyn invested $2325 in a savings account which earns 3.45% interest compounded monthly. What will the account be worth in 7 years?

Answer 1

\[A=P\left( 1+\frac{ r }{ n } \right)^{nt}\]

Answer 2

Where A is the accumulated amount (your answer); P is the principal, or beginning amount, r is the interest rate in decimal form; n is the number of com poundings (monthly means n = 12); and t is the number of years.

Answer 3

That made no sense to me at all @gryphon

Answer 4

A is your answer
P = 2325
r = .0345
n = 12
t = 7
You will need a calculator.

Answer 5

@gryphon ok i did the steps in the formula & its not matching any of my answer choices which are
$2,959.07

$25,144.92

$2,372.20

$40,159.15

Answer 6

When I made the calculation, I get:
\[A=2325\left(1+\frac{ .0345 }{ 12 } \right)^{12*7}=2959.07\]

Answer 7

then something is wrong with my calculator cause i put it in and i dont get that at all @gryphon

Answer 8

A common calculator error is to neglect to use parentheses for the product in the exponent. If you got 16,845.45, then that was your mistake-- just a calculator error. The rest of the calculation should be pretty straight forward. Try the calculation again, but replace the 12*7 with 84, or use your calculator's parentheses around the exponents, such as (12*7). @lay_lay396