Calculate the future value of an investment of $8200, after 5 months, earning 6% APR, compounded monthly, by calculate manually.
Reminder: Be sure to show your work, and to calculate the period interest before solving.
Period interest rate = annual interest rate/ # of interest periods per year
Period interest rate = 6%/5 = 0.012
0.012 + 1 = 1.012
First month = $8,200 x 1.012 = $8,298.40
Second month = $8,298.40 x 1.012 = $8,397.98
Third month = $8,397.98 x 1.012 = $8,498.76
Fourth month = $8,498.76 x 1.012 = $8,600.74
Fifth month = $8,600.74 x 1.012 = $8,703.95