Answer :
Answer:
Step-by-step explanation:
We would apply the formula for determining compound interest which is expressed as
A = P(1+r/n)^nt
Where
A = total worth of the CD at the end of t years
r represents the interest rate.
n represents the periodic interval at which it was compounded.
P represents the principal or amount of CD bought.
From the information given,
P = 1500
r = 6% = 6/100 = 0.06
n = 12 because it was compounded 12 times in a year.
The expression becomes
A = 1500(1+0.06/12)^12 × t
A = 1500(1+0.005)^12t
A = 1500(1.005)^12t
1) When t = 5 years,
A = 1500(1.005)^12 × 5
A = $2023.3
2) When t = 10 years,
A = 1500(1.005)^12 × 10
A = $2729.1
2) When t = 486 months = 486/12 = 40.5 years,
A = 1500(1.005)^12 × 40.5
A = $16935