Question 864399: How much interest will be earned at the end of 5 years on a deposit of $2500 in an account paying 5% interest compound monthly?
Answer by lwsshak3(11628)   (Show Source):
You can put this solution on YOUR website! How much interest will be earned at the end of 5 years on a deposit of $2500 in an account paying 5% interest compound monthly?
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compound interest formula: A=P(1+i)^n, P=initial investment, i=interest rate per period, n=number of periods, A =amount after n-periods
..
For given problem:
P=$2500
i=.05/12
n=5*12=60
A=2500(1+(.05/12))^60≈$3208
Interest earned=3208-2500=$708
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