Lea invests $8,250 in a savings account with a fixed annual interest of 8% compounded monthly. What will the account balance be after 5 years?

A = $12,291.23

Step-by-step explanation:

A = P + I where

P (principal) = $8,250.00

I (interest) = $4,041.23

Calculation Steps:

First, convert R as a percent to r as a decimal

r = R/100

r = 8/100

r = 0.08 rate per year,

Then solve the equation for A

A = P(1 + r/n)nt

A = 8,250.00(1 + 0.08/12)(12)(5)

A = 8,250.00(1 + 0.006666667)(60)

A = $12,291.23

Summary:

The total amount accrued, principal plus interest, with compound interest on a principal of $8,250.00 at a rate of 8% per year compounded 12 times per year over 5 years is $12,291.23.

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