Question

You have decided to start saving for college and open up a 529 account. You invest $5,000 into the account at a 4% interest rate compounded monthly. How much money will you have after 7 years?

$11,533.61
$13,482.02
$6,579.66
$6,612.57

Answer 1

I choose $6,612.57 am I right?

Answer 2

like a first step calcule the 4% interest rate of $5000 for 1 year
step by step how much will be this interest after 7 years ?

dont forget after every year this 5000 will increase by 4%
but attention please after second year this 4% will be of (5000 +4% of the first year )
and so in this way after 7 years