Question 815266
The MONTHLY rate is {{{(7/12)}}} percent, or {{{0.58333333}}} percent.


The model exponential equation is {{{p=2500*(1.00583333)^m}}},
p = amount of credit or the balance
m = how many months


You might want a time variable in years instead of months.  To use t for years, since 1 year is 12 months, then {{{t(12/1)=m}}} so from this you have {{{t=m/12}}}


You very well can use {{{p=2500(1+7/12)^(12t)}}} because now the rate used still IS the monthly rate and {{{12t}}} IS the number of months because we just found we can use {{{12t=m}}}.  NOTE VERY CAREFULLY, t is in YEARS.


Your main confusion was of forgetting that your initial principal amount was 2500 dollars.