How much would $500 invested at 5% interest compounded monthly be worth after 6 years?

Question

0

2251

2

Guest Jan 5, 2016

Guest · Answer 1 · 2016-01-05T07:29:24

In 6 years $500 @ 5% comp. monthly will be worth=$674.51

The formula you use to calculate this is: FV=PV(1 + R)^N, where FV=Future value, PV=Present value, R=Interest rate per period, N=Number of periods.

Guest · Answer 2 · 2016-01-05T07:31:53

Since 5% annual interest is compounded MONTHLY.....the MONTHLY interest rate is 5/12 =.4166 per period

Then Pf= P (1+ i )^n Pf = future principle i = interest = .4166% = .004166 n= periods (6 x 12 = 72)

Substitute and get the answer

674.47