Jackson deposits $210 each month into a savings account earning interest at the rate of 7% per year compounded monthly. How much will he have in this account at the end of 6 years?

Question

Aureo · Answer

Alright so first, let's look at what we have going on.

We are adding $210 each MONTH

We also have COMPOUND interest at 7% MONTHLY

And we need to see how much is there in 6 years.

So first lets convert the years into months.  How many months are in 6 years?

sanak24 · Answer

72

Aureo · Answer

Alright so now let's find out what we have before interest.
What's 210 * 72?

sanak24 · Answer

15120

Aureo · Answer

Okay so that gives us a ball park.  Do you know the compound interest formula?

Aureo · Answer

It's $$A=P(1+\frac{ r }{ n })^{nt}$$

Aureo · Answer

A is the amount we're trying to get, P is the principle ($15,120), r is the interest rate (.07 when converted to decimals), n is the number of times interest is compounded per year (12), and nt is time in years (6)

Aureo · Answer

So our formula now is $$A=15120(1+\frac{ .07 }{ 12 })^{6}$$

Aureo · Answer

Can you solve it from here, using PEMDAS?