Problema Solution
Determined the amount of an investment if $96,000 is invested at an interest rate of 5.2% compounded daily for 3 years
Answer provided by our tutors
P = $96,000 the principal
t = 3 years
r = 0.052 or 5.2%
m = 360 compounding periods per year
n = m*t = 360*3 = 1080 compounding periods
i = r/m = 0.052/360
A = the future (maturity) value
A = P(1 + i)^n
A = 96000(1 + 0.052/360)^1080
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A = $112,206.05
After 3 years the amount of the investment will become $112,206.05.