Suppose you deposit $2000 in a CD paying 2.7% interest, compounded monthly. How much will you have in the account after 6 years? Round your answer to the nearest cent.


To calculate the future value of an investment with interest compounded monthly, we can use the compound interest formula:

\[
A = P \left(1 + \frac{r}{n}\right)^{nt}
\]

Where:
- $A$ is the amount of money in the account after $t$ years.
- $P$ is the principal amount (initial investment), which is $2000.
- $r$ is the annual interest rate (as a decimal), which is 2.7%, or 0.027.
- $n$ is the number of times the interest is compounded per year (since it's compounded monthly, $n = 12$).
- $t$ is the number of years, which is 6 in this case.

Now, substitute the given values into the formula:

\[
A = 2000 \left(1 + \frac{0.027}{12}\right)^{12 \times 6}
\]

Let me calculate this.After 6 years, the amount in the account will be **$2351.29**, rounded to the nearest cent.

Would you like more details or have any questions about the calculation?

Here are five related questions:
1. How would the total change if the interest were compounded quarterly instead of monthly?
2. What if the interest rate was 3.5% instead of 2.7%?
3. How much interest will you have earned after 6 years?
4. What would the balance be after 10 years instead of 6?
5. How does the principal amount affect the future value?

**Tip:** When dealing with compound interest, increasing the frequency of compounding (like from yearly to monthly) results in slightly more interest being earned.

Suppose you deposit $2000 in a CD paying 2.7% interest, compounded monthly. How much will you have in the account after 6 years? Round your answer to the nearest cent.

Learn how to calculate the future value of a $2000 investment with 2.7% interest compounded monthly over 6 years. Using the compound interest formula, we find the account balance to be $2351.29 after 6 years. This problem covers key concepts in compound interest and exponential growth, suitable for students in Grades 10-12.

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