Question

Luis decides to invest $120,000 in a mutual fund that offers him 3.1% compound interest annually. This means that each year, the amount of money he has in the fund increases by 3.1% compared to the previous year. How much total money will there be in Luis's investment after 5 years?

likes

412 views

Answer to a math question Luis decides to invest $120,000 in a mutual fund that offers him 3.1% compound interest annually. This means that each year, the amount of money he has in the fund increases by 3.1% compared to the previous year. How much total money will there be in Luis's investment after 5 years?

$Expert avatar$

Timmothy

4.8

99 Answers

1. Use the compound interest formula:

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

.

2. Substitute the given values:

P = 120,000

r = 0.031

n = 1

, and

t = 5

.

3. Simplify the expression:

A = 120,000 \left(1 + \frac{0.031}{1}\right)^5

.

4. Further simplify inside the parentheses:

A = 120,000 \left(1 + 0.031\right)^5

.

5. Which simplifies to:

A = 120,000 \left(1.031\right)^5

.

6. Calculate the exponent:

A=120,000\left(1.1649\right)

.

7. Multiply to find:

A\approx139789.51

.

Thus, the total money in Luis's investment after 5 years will be approximately

139789.51

Frequently asked questions (FAQs)

What is the formula for finding the area of a square given its side length?

Find the derivative of f(g(h(x))) using the chain rule.

Math question: What is the vertex of the quadratic function y = x^2 + 4x - 7?

New questions in Mathematics

Two fire lookouts are 12.5 km apart on a north-south line. The northern fire lookout sights a fire 20° south of East at the same time as the southern fire lookout spots it at 60° East of North. How far is the fire from the Southern lookout? Round your answer to the nearest tenth of a kilometer

Additionally, the boss asked Armando to determine how many toy sales branches he would have in the fifteenth year, knowing that the first year they started with two branches, by the second they already had 5 branches and, by the third year, they had 8 branches. From the above, determine the number of branches it will have for the fifteenth year.

6. Among 100 of products there are 20 rejects. We will randomly select 10 of products. The random variable X indicates the number of rejects among the selected products. Determine its distribution.

In a store there are packets of chocolate, strawberry, tutti-frutti, lemon, grape and banana sweets. If a person needs to choose 4 flavors of candy from those available, how many ways can they make that choice?

Find the measures of the sides of ∆KPL and classify each triangle by its sides k (-2,-6), p (-4,0), l (3,-1)

The director of a company must transfer 6 people from the human resources department to the sales department, in order to sustain sales during the month of December. What is the probability that he will transfer only 2 of them?

4x-3y=5;x+2y=4

The beta of a company is 1,41 and its cost of equity 18,95%. What is then the market risk premium if the risk free rate is 0,94%? (in %, 2 decimal places)

Determine the general equation of the straight line that passes through the point P (2;-3) and is parallel to the straight line with the equation 5x – 2y 1 = 0:

Is -11/8 greater than or less than -1.37?

If X1 and X2 are independent standard normal variables, find P(X1^2 + X2^2 > 2.41)

The points (-5,-4) and (3,6) are the ends of the diameter of the circle calculate subequation

For what values of m is point P (m, 1 - 2m) in the 2⁰ quadrant?

Let f and g be defined in R and suppose that there exists M > 0 such that |f(x) − f(p)| ≤ M|g(x) − g(p)|, for all x. Prove that if g is continuous in p, then f will also be continuous in p.

17. A loan for $104259 is taken out for 10 years with an annual interest rate of 9.4%, compounded quarterly. What quarterly payment is required to pay the loan off in 10 years? Enter to the nearest cent (two decimals). Do not use $ signs or commas in the answer.

Kaya deposits 25,000 into an account that earns 3% interest compounded monthly. How much does Kaya have in the account after 6 years 8 months? Round to the nearest cent. 32,912.50 30,000 29,923.71 30,527.45

The area bounded by the curve y=ln(x) and the lines x=1 and x=4 above the x−axis is

6(k-7) -2=5

Find the distance from the point (2,-1) to the line 2x-5y+10=0

An invoice for €2,880 plus default interest of €48.40 was paid on October 28th. Interest rate 5.5%. When was the bill due?

Luis decides to invest $120,000 in a mutual fund that offers him 3.1% compound interest annually. This means that each year, the amount of money he has in the fund increases by 3.1% compared to the previous year. How much total money will there be in Luis's investment after 5 years?

You might be interested in