Use the compound interest formula to compute the total amount accumulated.
-$700 for 12 years at 3% compounded daily (use n = 360)
A) $998.03
B) $773.30
C) $1003.32
D) $700.70

Question

Quizplus · Accepted Answer

The compound interest formula is A = P(1 + r/n)^(nt), where A is the amount of money accumulated after n years, including interest, P is the principal amount ($700), r is the annual interest rate (3%, or 0.03 as a decimal), n is the number of times that interest is compounded per year (360), and t is the time the money is invested for (12 years). Plugging in the values: A = 700(1 + 0.03/360)^(360*12) = $1003.32.

Use the Compound Interest Formula to Compute the Total Amount