Question

A principal of $4500 is invested at 4.25% interest, compounded annually. How much will the investment be worth after 12 years?
Use the calculator provided and round your answer to the nearest dollar.

Answer 1

The money will be worth 7412 at the end of the 12th year.

What is compound interest?

Compound interest is the interest that accrues on a loan or deposit on both the initial interests and principal.

Analysis:

To calculate the amount after 12 years we use the compound interest formula, A = P$(1 + \frac{r}{100} )^{n}$

where A = amount after a period of time, P = initial principal = 4500, r = rate = 4.25, n = number of years = 12.

 A = 4500$(1 + \frac{4.25}{100} )^{12}$ = 7412

In conclusion, 7412 dollar will be realized at the end of the 12th year.

Learn more about compound interest: brainly.com/question/24924853

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