Question

At the time of her​ grandson's birth, a grandmother deposits $ 2000 in an account that pays 3.5 % compounded monthly. What will be the value of the account at the​ child's twenty-first​ birthday, assuming that no other deposits or withdrawals are made during this​ period?
The value of the account will be ​=
​(Round to the nearest dollar as​ needed.)

Answer 1

Answer:

The value of the account will be $4166.85.

Step-by-step explanation:

p = 2000

r = 3.5% or 0.035

t = 21

n = 12

Compound interest formula is :

$A=p(1+\frac{r}{n})^{nt}$

Now putting the values in the formula we get;

$A=2000(1+\frac{0.035}{12})^{12*21}$

=> $2000(1.002917)^{252}$

Amount = $4166.85

Hence, The value of the account will be ​= $4166.85

Answer 2

At the time of her grandson's birth, a grandmother deposits $12,000.00 in an account that pays 2% compound monthly. What will be that value of the account at the child's twenty-first birthday, assuming that no other deposits or withdrawls are made during the period.
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A(t) = P(1+(r/n))^(nt)
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A(21) = 12000(1+(0.02/12))^(12*21)
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A(21) = 12000(1.5214)
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A(21) = #18,257.15