Question 5 Find the accumulated value of an investment of 15

Question 5

Find the accumulated value of an investment of $1500 for 3 years at an interest rate of 3% if the money is compounded monthly

Solution

Accumulate Value A=P(1+r/100)^t

Here compounded monthly

A=P(1+r/12x100)¹²t

Given P=1500$ r=3 t=3

A=1500(1+3/12x100)^12x3

A=1500(1+1/4x100)³⁶

A=1500(1+1/400)³⁶

A=$2910.771