Find the balance in the account after the given period. $3500 deposit earning 6.75% compounded monthly after 6 months
To find the balance after the given period, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the final amount (balance)
P = initial deposit or principal amount ($3500)
r = annual interest rate (6.75% or 0.0675 as a decimal)
n = number of times interest is compounded per year (monthly, so n = 12)
t = number of years (6 months, so t = 0.5)
Plugging in the values into the formula, we have:
A = 3500(1 + 0.0675/12)^(12*0.5)
A = 3500(1 + 0.005625)^(6)
A = 3500(1.005625)^(6)
A ≈ 3500(1.033706971)
A ≈ 3611.97
So, the balance in the account after 6 months would be approximately $3611.97.