An initial deposit of $900 earns, 13% interest, compounded monthly. How much will be in the account in 4 1/2 years
We can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = the initial deposit
r = the annual interest rate (as a decimal)
n = the number of times the interest is compounded per year
t = the time period in years
In this case:
P = $900
r = 0.13 (13% expressed as a decimal)
n = 12 (compounded monthly)
t = 4.5 (4 1/2 years)
So:
A = 900(1 + 0.13/12)^(12*4.5)
A ≈ $1,668.89
Therefore, there will be approximately $1,668.89 in the account in 4 1/2 years.