a problem that has to do with compound interest

[fineangel03]

i dont understand it! please help me! it asks

find the balance of an account after one year when the principal is $2500 and the annual interest rate is 12.5% compounded monthly.

i tryed 2500(1+12.5x1)=33750 . i kno im supposed to make it to the power of 12 or something like that....but im not sure someone please help me

 

[Denis]

2500 (1 + .125 / 12) ^12

By the way, if I lend you $2500, will you pay me back $33750 after 1 year?