Concept explainers
Compound Interest Julio deposits $2000 in a savings account that pays 2.4% interest per year compounded monthly. The amount in the account after n months is given by
- (a) Find the first six terms of the sequence.
- (b) Find the amount in the account after 3 years.
(a)
To find: First six terms of amount generated.
Answer to Problem 77E
The first 6 terms of amount generated are $2004.00, $2008.01, $2012.02, $2016.05, $
2020.08 and $2024.12.
Explanation of Solution
Given:
Principal amount deposited in saving account is
Rate of interest compounded monthly is
The amount in account after n months is,
Calculation:
Substitute 1 for n in equation (1) to calculate amount after first month,
Substitute 2 for n in equation (1) to calculate amount after second month,
Substitute 3 for n in equation (1) to calculate amount after third month,
Substitute 4 for n in equation (1) to calculate amount after fourth month,
Substitute 5 to for n in equation (1) to calculate amount after fifth month,
Substitute 6 to for n in equation (1) to calculate amount after sixth month,
Thus the first 6 terms of amount generated are $2004.00, $2008.01, $2012.02, $2016.05, $2020.08, $2024.12.
(b)
To find: Amount in account after 3 years.
Answer to Problem 77E
Solution: The amount in account after 3 years are
Explanation of Solution
Given:
Principal amount deposited in saving account is
Rate of interest compounded monthly is
The amount in account after n months is,
Calculation:
Substitute
Thus the amount in account after 3 years are
Chapter 12 Solutions
Precalculus: Mathematics for Calculus - 6th Edition
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