Find the balance in the account after the given period.

Question

$ 2 comma 500 deposit earning 3.3 % compounded​ monthly, after 4 years.
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Part 1
The balance after 4 years will be ​$
  
enter your response here.​ (Round to the nearest cent as​ needed.)

Answer 1

To find the balance after 4 years, we can use the formula for compound interest:

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

Where:
A = final balance
P = principal amount (initial deposit)
r = annual interest rate (in decimal form)
n = number of times interest is compounded per year
t = number of years

In this case, the principal amount is $2,500, the annual interest rate is 3.3% (expressed as 0.033 in decimal form), interest is compounded monthly (12 times per year), and the number of years is 4.

Plugging in these values into the formula:

A = 2500(1 + 0.033/12)^(12*4)

A ≈ $2,847.73

Therefore, the balance in the account after 4 years, rounded to the nearest cent, is $2,847.73.