Interest Calculations and Balances

The video tutorial explains how to calculate monthly interest on an investment of $5,000 with a 6% annual interest rate compounded monthly. It demonstrates the process of calculating interest and updating the balance for each month, including additional deposits of $175. The tutorial covers five months, showing how the balance grows with each interest calculation and deposit.

What is the monthly interest rate if the annual interest rate is 6%?

• 0.05%

• 0.6%

• 1%

• 0.5%

How much interest is earned in the first month on a $5,000 balance?

• $15

• $20

• $30

• $25

What is the ending balance after the first month?

• $5,150

• $5,225

• $5,175

• $5,200

How much interest is earned in the second month on a $5,200 balance?

• $25

• $27

• $26

• $24

What is the ending balance after the second month?

• $5,450

• $5,401

• $5,375

• $5,426

How much interest is earned in the third month on a $5,401 balance?

• $27.50

• $26.50

• $27.01

• $28.00

What is the ending balance after the third month?

• $5,603.01

• $5,650.00

• $5,625.00

• $5,600.00

How much interest is earned in the fourth month on a $5,603.01 balance?

• $28.02

• $27.50

• $29.00

• $28.50

What is the ending balance after the fourth month?

• $5,850.00

• $5,806.03

• $5,825.00

• $5,800.00

What is the final balance after the fifth month?

• $6,025.00

• $6,000.00

• $6,010.06

• $6,050.00