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Type the correct answer in each box. Round your answers to nearest hundredth if necessary.
Suppose that Esther’s savings account earns an annual interest rate of 3.6% compounded monthly at the end of the month. Determine what just the first deposit of $50 will be worth at the end of a year, or 12 months. Use the interest rate and the formula for the future value of an investment.

Respuesta :

calculista

Answer:

[tex]\$51.83[/tex]  

Step-by-step explanation:

we know that    

The compound interest formula is equal to  

[tex]A=P(1+\frac{r}{n})^{nt}[/tex]  

where  

A is the Final Investment Value  

P is the Principal amount of money to be invested  

r is the rate of interest  in decimal

t is Number of Time Periods  

n is the number of times interest is compounded per year

in this problem we have  

[tex]t=1\ years\\ P=\$50\\ r=3.6\%=3.6/100=0.036\\n=12[/tex]  

substitute in the formula above

[tex]A=50(1+\frac{0.036}{12})^{12*1}[/tex]  

[tex]A=50(1.003)^{12}[/tex]  

[tex]A=\$51.83[/tex]  

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