4000. invested at a APR of 6% for 8 years compounded anually, what is the amount of money after 8 years
evaluate
4000(1.06)^8
To calculate the amount of money after 8 years with an initial investment of $4000, an Annual Percentage Rate (APR) of 6%, and compounded annually, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A is the amount of money after t years
P is the principal amount (initial investment)
r is the annual interest rate (in decimal form)
n is the number of times that interest is compounded per year
t is the number of years
In this case, the principal amount (P) is $4000, the annual interest rate (r) is 6% or 0.06, the interest is compounded annually (n = 1), and the number of years (t) is 8.
Plugging these values into the formula, we get:
A = 4000(1 + 0.06/1)^(1*8)
Simplifying further:
A = 4000(1.06)^8
Using a calculator or computer, we can calculate:
A ≈ $5,993.72
Therefore, the amount of money after 8 years would be approximately $5,993.72.