Calculate the future value of $15,000 invested for 5 years at an interest rate of 7% compounded monthly.

Question:- Calculate the future value of $15,000 invested for 5 years at an interest rate of 7% compounded monthly.

Answer: Here, we will utilize the compound interest formula:

FV = P * (1 + r/n)^(n*t)

Where:

FV = Future Value

P = Present Value (initial investment)

r = annual interest rate (in decimal form)

n = number of compounding periods per year

t = number of years

Given:

P = $15,000

r = 7% = 0.07

n = 12 (for monthly compounding)

t = 5 years

Substituting the values in the formula:

FV = $15,000 * (1 + 0.07/12)^(12*5)

FV = $15,000 * (1.005833)^60

FV = $15,000 * 1.4180

FV = $21,270

Hence the value of $15000 invested for a period of five years at an interest rate of 7 % compounded monthly is $21270.