The total amount accrued, principal plus interest, with compound interest on a principal of $1,000.00 at a rate of 3% per year compounded 12 times per year over 0.5 years is $1,015.09.
Compound Interest
Given Data
- Time = 6 months = 0.5 years
First, convert R as a percent to r as a decimal
r = R/100
r = 3/100
r = 0.03 rate per year,
Then solve the equation for A
A = P(1 + r/n)^nt
A = 1,000.00(1 + 0.03/12)^(12)(0.5)
A = 1,000.00(1 + 0.0025)^(6)
A = $1,015.09
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