To find out how much you will have in the account in 20 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment/loan, including interest
P = the principal investment amount (the initial deposit)
r = the annual interest rate (in decimal form)
n = the number of times that interest is compounded per year
t = the number of years the money is invested for
In this case:
P = $200 (monthly deposit)
r = 6% = 0.06 (annual interest rate in decimal form)
n = 12 (compounded monthly)
t = 20 (number of years)
First, we need to calculate the total amount of deposits over 20 years. Since you deposit $200 each month, the total deposits would be:
Total Deposits = $200/month x 12 months/year x 20 years
Total Deposits = $200 x 12 x 20
Total Deposits = $48,000
Now, let's calculate the future value of the investments:
A = P(1 + r/n)^(nt)
A = $48,000(1 + 0.06/12)^(12*20)
A = $48,000(1 + 0.005)^(240)
A = $48,000(1.005)^(240)
A ≈ $132,828.61
So, after 20 years, you will have approximately $132,828.61 in the account.
You deposit 200 each month into an account earning 6% interest compounded monthly how much will you have In The account in 20 years
1 answer