Question
70 is infested with an annual compound rate interestof 12% interest compounded monthly what is the total amount of the investment at the end of the second month
Answers
GPT 3.5
To calculate the total amount of the investment at the end of the second month, we need to use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment
P = the principal amount (initial investment)
r = annual interest rate (as a decimal)
n = number of times interest is compounded per year
t = number of years
In this case, the principal amount (P) is 70, the annual interest rate (r) is 12% expressed as 0.12, interest is compounded monthly, so the number of times interest is compounded per year is 12, and the number of years (t) is 2 months divided by 12 months.
Plugging the values into the formula:
A = 70(1 + 0.12/12)^(12*(2/12))
A = 70(1 + 0.01)^1
A = 70(1.01)
A = 70.7
Therefore, the total amount of the investment at the end of the second month is approximately $70.70.
A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment
P = the principal amount (initial investment)
r = annual interest rate (as a decimal)
n = number of times interest is compounded per year
t = number of years
In this case, the principal amount (P) is 70, the annual interest rate (r) is 12% expressed as 0.12, interest is compounded monthly, so the number of times interest is compounded per year is 12, and the number of years (t) is 2 months divided by 12 months.
Plugging the values into the formula:
A = 70(1 + 0.12/12)^(12*(2/12))
A = 70(1 + 0.01)^1
A = 70(1.01)
A = 70.7
Therefore, the total amount of the investment at the end of the second month is approximately $70.70.