Question

Suppose that you invest 5873 in an account that earns an interest rate of 4.4% compounded monthly determine the accumulated balance after 7 years

Answer 1

present value, P = 5873
interest rate, i = 4.4%/12 = 0.044/12 per month
Number of periods, n = 7*12 = 84 months.

Future value

`F=P(1+i)^n`

`=5873(1+0.044/12)^(84)`

`=7986.90` to the nearest cent