Answer:
A. $360.21
Step-by-step explanation:
Since, when in an amount the interest is compounded monthly,
Then, the final amount after t years is,
[tex]A=P(1+\frac{r}{12})^{12t}[/tex]
Where, r is the annual interest,
P is the principal amount,
Here, P = $ 2400, r = 2.8 % = 0.028 and t = 5 years,
Hence, the amount after 5 years,
[tex]A=2400(1+\frac{0.028}{12})^{12\times 5}[/tex]
[tex]=2400(1+\frac{0.028})^{60}[/tex]
[tex]=2760.20694682\approx \$ 2760.21[/tex]
Therefore, the interest after 5 years is,
[tex]I=A-P[/tex]
[tex]=\$ 2760.21 - \$ 2400=\$ 360.21[/tex]
Option A is correct.
