Problema Solution
How much would $100 invested at 9% interest compounded monthly be worth after 7 years? Round your answer to the nearest cent. Do not include units in your answer.
Answer provided by our tutors
There are 7*12 = 84 months in 7 years.
I'm assuming that the 9% is an annual interest rate. Therefore the monthly rate is 0.09/12.
So, here's the multiplier:
(1 + 0.09/12 )^84 = 1.0075^84 = 1.8732
And so 100 dollars becomes 187.32 after 7 years.