Find the value for $20000 earning 6% interest compounded monthly for 4 years

Question

I need to find the answer to this 

Answer 1

 

Compound Interest

 

 

A = P(1+r/n)^nt

 

A = amount of money accumulated after n years, including interest.
P = principal amount (the initial amount you borrow or deposit)=$20000
r = annual rate of interest (as a decimal)=6%=0.06
t = number of years the amount is deposited or borrowed for=4

n = number of times the interest is compounded per year =monthly=12

 

 

 

A = 20000(1+0.06/12)(12)(4)

 

   =20000[(12+0.6)/12]⁴⁸

 

   =20000(12.06/12)⁴⁸

 

   =20000(1.005)⁴⁸

 

   =20000*1.2705

  

   =25409.78

 

Ans =$25409.78

 

Answer 2

Sara, what's the formula? A = P(1 +r/n)^nt

 

P is the principal invested

r is the rate as a decimal

n is the number of times compounded annually

t is the number of years.

 

A = 20000(1 + .06/12)¹²⁽⁴⁾

 

Throw that in your calculator for your answer.