Principal 450.00 x interest rate 9.25 x compounded monthly x 4 years
To calculate the total amount using the principal, interest rate, and compound period, we can use the compound interest formula:
A = P(1 + r/n)^(nt)
Where:
A = Total amount
P = Principal (initial amount)
r = Interest rate (in decimal form)
n = Number of times interest is compounded per year
t = Number of years
Given the values:
Principal (P) = $450.00
Interest rate (r) = 9.25% (converted to decimal form is 0.0925)
Compound period (n) = monthly (12 times per year)
Number of years (t) = 4
Substituting these values into the formula:
A = 450(1 + 0.0925/12)^(12*4)
First, calculate the value in the parentheses:
(1 + 0.0925/12) = 1.0077083333
Then, raise this value to the power of (12*4):
(1.0077083333)^(12*4) = 1.395783421
Finally, multiply this value by the principal amount:
A = 450 * 1.395783421
Calculating the final answer:
A ≈ $627.60
Therefore, the total amount after 4 years with a principal of $450.00, an interest rate of 9.25% compounded monthly would be approximately $627.60.