Question

If P=2500, r=6 %, and m=12, find the accumulated amount after 5 years.

Answer 1

hello

the question presented here related to compound interest and we can solve that using the formula

$\begin{gathered} A=p(1+\frac{r}{n})^{nt}^{} \\ r=\text{rate}=6\text{ \% = 0.06} \\ n=12 \\ p=2500 \\ t=5 \\ \end{gathered}$

let's proceed to substitute the values into the equation

$\begin{gathered} A=2500(1+\frac{0.06}{12})^{12\times5} \\ A=2500(1+0.005)^{60} \\ A=2500(1.005)^{60} \\ A=2500\times1.005^{60}^{} \\ A=2500\times1.3488 \\ A=3375 \end{gathered}$

the compounded interest compounded monthly at 6% for 5 years is 3375