document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=215113>Question 215113</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Hi, my name is Christy. Our professor passes out sheets in our class and I was wondering if you could help me with one of the questions.\r<BR>\n" );
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document.write( "It is the formula {A = P ( 1+R/N) nt Compounding Interest.\r<BR>\n" );
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document.write( "My question is An investment earns 5.6% interest, compounded monthly. Find the balance in the account after 3 years if $6000 is invested initially.\r<BR>\n" );
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document.write( "I had A = $6000 ( 1 + 0.056/365) (1) (3) Is this right? I am lost on how to get the correct answer. I know the formula, but cannot figure out how to get the correct answer. Thanks. </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #162548 by </B><A HREF=/tutors/aboutme.mpl?userid=jim_thompson5910><B>jim_thompson5910(35256)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=jim_thompson5910><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=162548\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> First, since this balance is compounded monthly, the value of 'n' is <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=n=12 ALIGN=MIDDLE  ALT=\"n=12\"   DISABLED_style= \"max-width:90%; height:auto;\" > (not 365) since 'n' is the <font color=red>n</font>umber of times the balance is compounded annually.\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=P%281%2Br%2Fn%29%5E%28n%2At%29 ALIGN=MIDDLE  ALT=\"A=P%281%2Br%2Fn%29%5E%28n%2At%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > Start with the compound interest formula\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=6000%281%2B0.056%2F12%29%5E%2812%2A3%29 ALIGN=MIDDLE  ALT=\"A=6000%281%2B0.056%2F12%29%5E%2812%2A3%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > Plug in <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=P=6000 ALIGN=MIDDLE  ALT=\"P=6000\"   DISABLED_style= \"max-width:90%; height:auto;\" > (initial investment), <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=r=0.056 ALIGN=MIDDLE  ALT=\"r=0.056\"   DISABLED_style= \"max-width:90%; height:auto;\" > (this is the decimal form of 5.6% interest), <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=n=12 ALIGN=MIDDLE  ALT=\"n=12\"   DISABLED_style= \"max-width:90%; height:auto;\" >, and <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=t=3 ALIGN=MIDDLE  ALT=\"t=3\"   DISABLED_style= \"max-width:90%; height:auto;\" > (3 years)\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=6000%281%2B0.00466667%29%5E%2812%2A3%29 ALIGN=MIDDLE  ALT=\"A=6000%281%2B0.00466667%29%5E%2812%2A3%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > Divide 0.056 by 12 to get 0.00466667\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=6000%281%2B0.00466667%29%5E%2836%29 ALIGN=MIDDLE  ALT=\"A=6000%281%2B0.00466667%29%5E%2836%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > Multiply the exponents 12 and 3 to get 36\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=6000%281.00466667%29%5E%2836%29 ALIGN=MIDDLE  ALT=\"A=6000%281.00466667%29%5E%2836%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > Add 1 and 0.00466667 to get 1.00466667\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=6000%281.1824746%29 ALIGN=MIDDLE  ALT=\"A=6000%281.1824746%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > Raise 1.00466667 to the 36 th power to get 1.1824746\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=7094.8476 ALIGN=MIDDLE  ALT=\"A=7094.8476\"   DISABLED_style= \"max-width:90%; height:auto;\" > Multiply 6000 and 1.182474 to get 7094.8476\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=A=7094.85 ALIGN=MIDDLE  ALT=\"A=7094.85\"   DISABLED_style= \"max-width:90%; height:auto;\" > Round to the nearest cent.\r<BR>\n" );
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document.write( "So if you invest $6,000 at an interest rate of 5.6%, which is compounded 12 times a year for 3 years,  the return is about $7,094.85 (which is rounded to the nearest cent) </SPAN>\n" );
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