Exponential function

Question

I deposit $500 in an account that collects 4% interest compounded monthly. I leave it alone for 10 years. How much money do I have after 10 years?

Answer 1

The formula to use is:

A=P(1+r/n)^(t*n)

P = principal amount (the initial amount you borrow or deposit)

r = annual rate of interest (as a decimal)

t = number of years the amount is deposited or borrowed for.

A = amount of money accumulated after n years, including interest.

n  = number of times the interest is compounded per year 

A=500(1+0.04/12)^(10*12)

A=$745.42