Given:
Amount deposited is $1500.
8.5% annual interest compounded monthly.
a) The interest rate per month is,
[tex]\begin{gathered} r=\frac{8.5\text{ \%}}{12} \\ r\approx0.71\text{ \%} \end{gathered}[/tex]b) the exponential growth model of the account after t years is,
[tex]\begin{gathered} A=P(1+\frac{r}{m})^{tm} \\ A=1500(1+\frac{8.5}{100\times12})^{12t} \\ A=1500(1+\frac{0.085}{12})^{12t} \end{gathered}[/tex]Answer:
[tex]A=1500(1+\frac{0.085}{12})^{12t}[/tex]c) The value of investment after 5 years is,
[tex]\begin{gathered} A=1500(1+\frac{0.085}{12})^{12t} \\ A=1500(1.0070833)^{12\times5} \\ A=2290.95 \end{gathered}[/tex]Answer: The amount after 5 years will be $ 2290.95
