Carmen M. answered • 01/04/16
Tutor
5.0
(33)
Mechanical Engineer, Master in Science
Hi Ashley
The formula for annual compound interest is A = P (1 + r/n) ^ nt:
Where:
A = the future value of the investment
P = investment amount
r = the annual interest rate (decimal)
n = the number of times that interest is compounded per year
t = the number of years the money is invested
Where:
A = the future value of the investment
P = investment amount
r = the annual interest rate (decimal)
n = the number of times that interest is compounded per year
t = the number of years the money is invested
In your case
P= $2000
r=0.035
n=12
t=1
Hope this helps!
Carmen
Andrew M.
In the formula A = P(1+r/n)nt
n = # times interest is compounded each year
n = 1, not 12
t (time in years) is the unknown. The longer the money is left
in the account the more interest it accumulates.
Report
01/04/16
Andrew M.
01/04/16