A girl opens a saving account with $100 and the bank pays 1 % monthly interest rate, how much money she will have after 12 months, if she does not deposit or draw any amount?.
To calculate the amount of money the girl will have in her savings account after 12 months, you can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the future value of the investment/amount of money after a certain period (in this case, after 12 months)
P = the principal amount (starting deposit) = $100
r = the annual interest rate (in decimal form) = 0.01 (1% as a decimal)
n = the number of times the interest is compounded per year (monthly compounding, so n = 12)
t = the number of years (in this case, 1 year = 12 months)
Plugging in the values into the formula, you get:
A = $100(1 + 0.01/12)^(12 * 1)
Simplifying:
A = $100(1 + 0.000833)^12
A ≈ $100(1.000833)^12
A ≈ $100(1.010050100833678)
A ≈ $101.0050100833678
Therefore, the girl would have approximately $101.01 in her savings account after 12 months, assuming she does not deposit or withdraw any amount.