Chapter 2 Question 2.13, Introduction to Java Programming, Tenth Edition Y. Daniel LiangY.

(Financial application: compound value) Suppose you save $100 each month into a savings account with the annual interest rate 5%. Thus, the monthly interest rate is 0.05/12 = 0.00417. After the first month, the value in the account becomes 

100 * (1 + 0.00417) = 100.417 

After the second month, the value in the account becomes 

(100 + 100.417) * (1 + 0.00417) = 201.252 

After the third month, the value in the account becomes 

(100 + 201.252) * (1 + 0.00417) = 302.507 and so on. 

Write a program that prompts the user to enter a monthly saving amount and displays the account value after the sixth month.

Solution

import java.util.Scanner;

public class Exercise_02_13 {

    public static void main(String[] args) {

        Scanner input = new Scanner(System.in); // Create a new Scanner object.

        final double MONTHLY_INTEREST_RATE = 0.00417;   // Initialize constant value

        // Prompt the user to enter a montly saving amount

        System.out.print("Enter the monthly saving amount: ");

        double savingAmount = input.nextDouble();

        // Compute first month account value

        double total = 100 * (1 + MONTHLY_INTEREST_RATE);

        // Compute second month account value

        total = (100 + total) * (1 + MONTHLY_INTEREST_RATE);

        // Compute third month account value

        total = (100 + total) * (1 + MONTHLY_INTEREST_RATE);

        // Compute forth month account value

        total = (100 + total) * (1 + MONTHLY_INTEREST_RATE);

        // Compute fifth month account value

        total = (100 + total) * (1 + MONTHLY_INTEREST_RATE);

        // Compute sixth month account value

        total = (100 + total) * (1 + MONTHLY_INTEREST_RATE);

        // Display result

        System.out.println("After the sixth month, the account value is " + total);

    }

}