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What is the future value of the 10% savings from earnings of $1,470 if it earns 3.5% annual interest,


compounded monthly for 25 years?


Use the compound interest formula to estimate the future value.


A = P (1+r/n)^nt


A.

$295.72


B.

$352.19


C.

$419.43


D.

$523.89


What is the future value of the 10% savings from earnings of $36,000 if it earns 6.25% annual interest, compounded quarterly for 15 years?


Use the compound interest formula to estimate the future value.


A = P (1+r/n)^nt


A.

$912.65


B.

$9,126.53


C.

$1,825.31


D.

$18,253.31


Justin contributes $208 each month to a savings account that earns 5% annual interest. Calculate his annuity savings over the course of 25 years.


Use

S = P ((1+r^n)-1/r)


A.

$9.927.23


B.

$65,520.00


C.

$62,660.00


D.

$123,866.02

Respuesta :

MrsStrong

Answer:

B

Step-by-step explanation:

The compound interest formula is [tex]A = P (1+r/n)^nt[/tex] where:

  • P is the starting amount called the principle
  • r is the rat written as a decimal
  • n is the number of times compounded in a year
  • t is the number of years

Substitute a value into each variable to solve.

  • P = $147 since 10% of 1,470 is being invested which makes P = 0.10(1470) = 147.
  • The rate is 3.5% or r = 0.035.
  • n = 12 because it is compounded monthly meaning 12 times a year.
  • t = 25 since it will earn for 25 years.

[tex]A = P (1+r/n)^{nt}\\A = 147(1 + \frac{0.035}{12})^{12*25}\\A = 147 ( 1 + 0.002916)^{300}\\A = 147(1.002916)^{300}\\A = 352.19[/tex]

Repeat this process for each formula.

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