Hellen invested $20,000 that earns 4.68% compounded monthly for four years. Find the future value of Hellen’s investment.

Question

Hellen invested $20,000 that earns 4.68% compounded monthly for four years.  Find the future value of Hellen’s investment.

Answer 1

The formula for compounded interest is

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

P = 20,000(1 + .0468/12)¹²⁽⁴⁾

P = 20,000(1 + .0039)⁴⁸

P = 20,000(1.0039)⁴⁸

P = 20,000(1.205429)

P = $24,108.59