Solve the problem.
-Find the amount owed at the end of 8 years if $5000 is loaned at a rate of 5% compounded monthly.
A) $8060.16
B) $12,911.25
C) $7452.93
D) $9093.60

Question

Quizplus · Accepted Answer

The formula for compound interest is A = P(1 + r/n)^(nt), where P is the principal amount ($5000), r is the annual interest rate (0.05), n is the number of times interest is compounded per year (12), and t is the number of years (8). Plugging in these values, A = 5000(1 + 0.05/12)^(12*8) = $7452.93.

Solve the Problem. -Find the Amount Owed at the End of 8 Years