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Popular >

You deposit 550 in an account that pays 5% annual interest. What is the balance after 3 years if the interest is compounded monthly?

Solution

You deposit 550 in an account that pays 5% annual interest. What is the balance after 3 years if the interest is compounded monthly?

Solution

Amount : 638.81

Solution steps

Translate the problem into an equation:

A = 550 (1 + \frac{0.05}{12})^{12 \cdot 3}

550 (1 + \frac{0.05}{12})^{12 \cdot 3} = 638.80972 \dots

Round to the nearest hundredth:

638.81

Amount : 638.81

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