If 47400 dollars is invested at an interest rate of 7 percent per year, find the value of the investment at the end of 5 years for the following compounding methods, to the nearest cent

Question

(a) Annual: $____ 

(b) Semiannual: $ ______

(c) Monthly: $ _______

(d) Daily: $______

Answer 1

Use the formula A = P (1 + r / n)^(n t), where

P is the principal, i.e., what you're starting with,

r is the annual rate of interest (be sure to convert to decimal form first),

t is the time interval (in years),

n is the number of compound periods in a year (so, for parts (a) through (d), n is 1, 2, 12, 365 respectively), and

A is the final amount.