Ana052698idn
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Maya deposits $5000 into a checking account that pays 0.75% annual interest compounded monthly. What will be the balance after 8 years? Round to the nearest cent.

Sagot :

[tex]~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+\frac{r}{n}\right)^{nt} \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill &\$5000\\ r=rate\to 0.75\%\to \frac{0.75}{100}\dotfill &0.0075\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{monthly, thus twelve} \end{array}\dotfill &12\\ t=years\dotfill &8 \end{cases} \\\\\\ A=5000\left(1+\frac{0.0075}{12}\right)^{12\cdot 8}\implies A=5000(1.000625)^{96}\implies A\approx 5309.08[/tex]

Samuelonum1idn

The total amount accrued, principal plus interest, with compound interest on a principal of $5,000.00 is $5,307.99.

Compound Interest

Given Data

  • Principal = $5000
  • Rate = 0.75%
  • Time = 8 Years

A = P + I where

P (principal) = $5,000.00

I (interest) = $307.99

Calculation Steps:

First, convert R as a percent to r as a decimal

r = R/100

r = 0.75/100

r = 0.0075 rate per year,

Then solve the equation for A

A = P(1 + r/n)^nt

A = 5,000.00(1 + 0.0075/1)^(1)(8)

A = 5,000.00(1 + 0.0075)^(8)

A = $5,307.99

Lear More about Compound interest here:

https://brainly.com/question/24924853

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