If $3000 is invested at 3% compounded monthly how much in 9 years
A = 3000(1+((.03)/12))^(12)(9)
Just plug that into a calculator
To calculate the future value of an investment with compound interest, you can use the formula:
Future Value = Principal (1 + Rate / n)^(n * t)
Where:
- Principal is the initial amount invested ($3000)
- Rate is the interest rate per period (3% or 0.03 in decimal form)
- n is the number of compounding periods per year (12 for monthly compounding)
- t is the number of years the money is invested for (9 years)
Plugging in the values into the formula, we get:
Future Value = $3000 * (1 + 0.03 / 12)^(12 * 9)
Now let's calculate it step by step:
Step 1: Calculate the fractional interest rate per period:
Fractional Interest Rate = Rate / n
= 0.03 / 12
= 0.0025
Step 2: Calculate the number of compounding periods:
Number of Compounding Periods = n * t
= 12 * 9
= 108
Step 3: Calculate the future value using the formula:
Future Value = Principal * (1 + Fractional Interest Rate)^(Number of Compounding Periods)
= $3000 * (1 + 0.0025)^108
Using a calculator, we evaluate the expression and find that the future value of the investment after 9 years with monthly compounding will be approximately $3,860.04.