Help Please!! I will give a medal and become a fan! Lucas opened a savings account 20 years ago with a deposit of $3,815.24. The account has an interest rate of 3.3% compounded quarterly. How much interest has Lucas earned?

Question

phi · Answer

do you have a formula for compound interest ?

anonymous · Answer

Yeah and I used it but I still didnt figure it out.

anonymous · Answer

Nevermind I got it.

phi · Answer

I would use
P = P0 * (1+i/n)^nt

P0 is the starting amount 3,815.24
n=4, quarterly means you divide the yearly interest rate by 4

t= 20 years  (so nt is 4*20 or 80)

i is 3.3% changed to a decimal.  0.033

what did you get ?

anonymous · Answer

$3,546.50

phi · Answer

Start with the formula
P = P0 * (1+i/n)^nt

replace the letters with their values. Don't do any arithmetic, just write in the numbers, to see if you are starting off correctly

phi · Answer

The interest is (1+i/n)^nt -1   all times  P0
you get your number

anonymous · Answer

$$3,815.24(1+\frac{ 3.3% }{ 4 })^{4\times20}$$

anonymous · Answer

Oh ok

phi · Answer

your equation should use 3.3%  changed to a decimal.  3.3% is the same as 3.3/100 or 0.033
you should use 0.033

if you do that you will find the total amount,  principal plus interest.
if you subtract off the principal, you get the interest