Answer:
The amount of the withdrawal after 2 years will be $ 4508.64
Step-by-step explanation:
Given : Doris put $ 4000 in a 2-year CD paying 6% interest, compounded monthly.
We have to find the amount of the withdrawal.
Since given the principal amount is $ 4000 for 2 years and
Rate is 6% = 0.06
Since, interest is calculated compounded monthly
so monthly interest rate is [tex]\frac{6}{1200}[/tex]
Using Formula for compound interest
[tex]A=P(1+r)^n[/tex]
Where A is amount
r is interest rate
n is time period
Substitute, we have,
[tex]A=4000\left(1+\frac{6}{1200}\right)^{\left(12\cdot2\right)}[/tex]
Simplify, we have ,
A = 4508.64
Thus, The amount of the withdrawal after 2 years will be $ 4508.64
