Calculating Compound Amount of an Investment with Daily Compounding
How to calculate the compound amount of an investment with daily compounding?
Calculating Compound Amount of Thomas Ash's Account
Scenario: On April 18, Thomas Ash deposited $2,500 in a passbook savings account at 3.5% interest compounded daily.
Question: What is the compound amount (in $) of his account on August 5?
Final Answer: The compound amount on August 5 is $2,567.15.
Explanation: Thomas Ash's deposit of $2,500 at 3.5% interest compounded daily from April 18 to August 5 is calculated as follows: - Number of days from April 18 to August 5 = 109 days - Using the formula A = P(1+365i)^n: A = 2500(1 + (0.035/365))^109 A = $2,567.15 Therefore, the compound amount in Thomas Ash's account on August 5 is $2,567.15.