Taylor want to help to pay for college for her newborn nephew. She places $2,000 into a savings account that pays 10% interest that is compo

Question

Taylor want to help to pay for college for her newborn nephew. She places $2,000 into a savings account that pays 10% interest that is compounded monthly. How much will be in the account in 18 years?

Need help asap!!!!!

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Clara 2 weeks 2021-11-16T03:22:29+00:00 1 Answer 0 views 0

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    2021-11-16T03:23:57+00:00

    At the end of 18 years, there will be $45,200 in the savings account.

    Step-by-step explanation:

    Step 1; First we must calculate how much interest there is in total over 18 years. The monthly interest rate is 10% × 12 = 120% i.e. 120% of $2,000 which equals $2,400. As the years pass, more and more will be put into the account due to interest. After 18 years, there will be an interest of 2,160% (120% per year * 18 years) of the initial amount.

    Step 2; We must find the money due to interest and add it with the money that was put in initially. The interest amount is 18 times the $2,400 which was put in. The interest equals $43,200. With this, the initial $ 2,000 is added which comes to a total of $45,200

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