Question

PLEASE HELP!! MEDAL!!
You put $5000 in a savings account which earns compound interest at a rate of 0.5% per month. If you dont make any deposits or withdrawls, how much will you have in your account in 30 years ( 360 months)? Round your answer to the nearest whole cent.

a.$21,609.71
b.$5807.00
c.$22,324.85
d.$30,112.88

Answer 1

Here is the compound interest formula: A=P(1+rn)nt
A = Amount at maturity
P = Principal Amount = $5,000
r = Annual interest rate in decimal = 12*.5 = 6%. In decimal: 0.06
n = compounding period (compounded how many times a year) = 12
t = years invested = 30

A=5,000(1+0.0612)12∗30=5,000(1.005)360=$30,112.88

Answer 2

So your answer would be D.