Eddie deposited $1200 into an account that earns 3% interest compounded 2 times per year. How much money will Eddie have in his account after 7 years?

1 Answer
Jun 5, 2018

Answer:

#$1,478.11#

Explanation:

Here we will use the compound interest formula below:

#A_t = P(1+r/n)^(n*t)#

Where:

#P=# Principal amount
#r =# Annual rate
#n=# Number of times compounded per year
#t=# Number of years
#A_t=# Amount after t years

In this example:

#A_7 = 1200(1+0.03/2)^(7xx2)#

#= 1200xx(1.015)^14#

#approx 1200 xx 1.2317557#

#=$1,478.11# to nearest cent