Question
Tara deposits $\$ 5,000$ in a certificate of deposit. The annual interest rate is $7 \%$, and the interest will be compounded monthly. How much will the certificate be worth in 10 years?

Round your answer to the nearest cent.
Do NOT round until you calculate the final answer

Step 1 ：Given that the principal amount (P) is $5000, the annual interest rate (r) is 7% or 0.07, the number of times that interest is compounded per year (n) is 12, and the time the money is invested for in years (t) is 10.

Step 2 ：The formula for compound interest is \(A = P (1 + \frac{r}{n})^{nt}\)

Step 3 ：Substitute the given values into the formula: \(A = 5000 (1 + \frac{0.07}{12})^{12*10}\)

Step 4 ：Simplify the expression inside the parentheses: \(A = 5000 (1 + 0.0058333333)^{120}\)

Step 5 ：Calculate the power: \(A = 5000 * 2.00968307\)

Step 6 ：Multiply to find the final amount: \(A = \boxed{10048.42}\)