Question

i take an investment of $1,000 dollars with compounding interest of 8% monthly how much will i have in 5 years. No other capital is added besides the initial 1,000 and interest over the time period

Answer 1

We can answer this using the compound interest formula:

Where,
A = Amount after 5 years
P = Principal amount
i = interest rate in decimal form. (8% or 0.08)
n = number of periods

When compounding is monthly, n = 5*12 = 60

Substituting the values in the formula, we get:

So you will have $101,257.06 at the end of 5 years if you invested 1000 today with compounding interest of 8% monthly.

Please note that, I have solved this problem assuming interest rate is 8% monthly and not 8% annually. If it is 8% annually then the answer will be $1,489.85. If you have any doubts let me know in the comments.