Question

Write a compound interest function to model the following situation. Then, find the balance after the given number of years.$11,000 invested at a rate of 3% compounded monthly; 6 years

Answer 1

Solution:

Given the amount invested as $11,000 at a rate of 3% compounded monthly for 6 years.

Thus, the compound interest function that model the situation is;

$\begin{gathered} A=11000(1+\frac{0.03}{12})^{12(6)} \\ \\ A=11000(1.0025)^{72} \end{gathered}$

Thus, the balance after 6 years is;

$A=13166.43$