A credit union client deposits $1,600 in an account earning 4% interest, compounded monthly. What will the balance of the account be at the end of 15 years?

Answer 1

A = P (1 + r/n) ^(nt)

1. A = the future value of the investment/loan, including interest
2. P = the principal investment amount (the initial deposit or loan amount)
3. r = the annual interest rate (decimal)
4. n = the number of times that interest is compounded per unit t
5. t = the time the money is invested or borrowed for

Plugging in your values

A = 1600 (1 + .04/12) ^(12*15)

A=$2912.48