To answer this question we will use the following formula for compounded interest:
[tex]\begin{gathered} P=P_0(1+\frac{r}{12})^{12t},^{} \\ \text{where P}_0\text{ is the initial amount, r i}s\text{ the interest rate as a decimal number and t is the } \\ n\text{umber of years.} \end{gathered}[/tex]Substituting P₀=4000, r=0.03 and t=10 we get:
[tex]P=4000(1+\frac{0.03}{12})^{120}\text{.}[/tex]Simplifying the above result we get:
[tex]\begin{gathered} P=4000(1+0.0025)^{120} \\ \approx77432.60. \end{gathered}[/tex]Answer: $77432.60.
