When 70 dollars is invested monthly with an annual compound interest rate of 12% compounded monthly what is the total amount of the investment at the end of the second month? round it the answer to two decimal places as needed.
To find the total amount of the investment at the end of the second month, we can use the compound interest formula:
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = the monthly investment
r = the annual interest rate
n = the number of times the interest is compounded per year
t = the number of years
In this case,
P = $70
r = 12% = 0.12
n = 12 (compounded monthly)
t = 2/12 = 1/6 (since we want to find the amount after 2 months)
A = 70(1 + 0.12/12)^(12 * 1/6)
A = 70(1 + 0.01)^(2)
A = 70(1.01)^2
A = 70(1.0201)
A = 70 * 1.0201
A ≈ $71.407
Rounded to two decimal places, the total amount of the investment at the end of the second month is approximately $71.41.