Question

approximately how much money would Maddie have if he invested $1,200 at an interest rate of 5% for 7 years compounded monthly (12 times a year)?

Answer 1

ok

Formula

$\begin{gathered} A\text{ = P(1 + }\frac{r}{n})^{nt} \\ \end{gathered}$

P = 1200

r = 0.05

n = 12

t = 7

Substitution

$\text{ A = 1200(1 + }\frac{0.05}{12})^{12(7)}$

Simplification

$\text{ A = 1200(1.0042)}^{84}$

Result

$\text{ A = 1706.39}$

Maddie will have $1706.39