Siobhan deposits 1200 into a savings account that pays 5.2% annual interest compounded monthly. What will be the balance after 4 years? Round to the nearest cent.

Solution

Solution

Amount : 1476.79

Solution steps

Translate the problem into an equation:

A = 1200 (1 + \frac{0.052}{12})^{12 \cdot 4}

1200 (1 + \frac{0.052}{12})^{12 \cdot 4} = 1476.79202 \dots

Round to the nearest hundredth:

1476.79

Amount : 1476.79

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