How much money would you have after 7 years if you invested $12,000 at 2% compounded annually?
To calculate the future value of an investment with compound interest, you can use the formula:
A = P(1 + r/n)^(nt)
where:
A = the future value of the investment
P = the principal amount (initial investment) = $12,000
r = annual interest rate = 2% = 0.02
n = number of times the interest is compounded per year = 1 (annually)
t = number of years the money is invested for = 7
Plugging in the values:
A = $12,000(1 + 0.02/1)^(1*7)
A = $12,000(1.02)^7
A = $12,000(1.161239)
A = $13,934.87
Therefore, after 7 years, you would have approximately $13,934.87 if you invested $12,000 at 2% compounded annually.