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Find the value of $1000 deposited for 10 years in an account paying 6% annual interst compounded monthly.

That is the problem i have and i dont know how to solve it step by step.
Guest Apr 22, 2012
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You have to use the formula for compound interest which is: A=P(1+r/n)^nt
The Givens info is:
A=?
P=1000
r= 6% = 0.06 (convert into decimal)
n=12(# of interest periods: since it is monthly n=12)
t=10

Now your formula should look like this:

A= 1000*(1+(0.06/12))^12*10
A=1000*(1.005)^120
A=1000*(1.819396734)
A=$1819.40
Guest Apr 22, 2012

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