Question

A man wants to set aside $3600 at 8% interest compounded quarterly. Find the amount of money at the end of 3 years.

Answer 1

\[3600\times\left(1+\frac{.08}{4}\right)^{12}\] and a calculator

Answer 2

I did that the first time. $4,565.67 so I was right the first time? Quarterly threw me off a bit.

Answer 3

\[ A = P(1+\frac{r}{n})^{nt}\]
P = Principal Amount
r = annual rate of interest
t = number of years the amount is deposited or borrowed for.
A = amount of money accumulated after n years, including interest.
n = number of times the interest is compounded per year

Answer 4

Example:

An amount of $1,500.00 is deposited in a bank paying an annual interest rate of 4.3%, compounded quarterly. What is the balance after 6 years?
Solution:

Using the compound interest formula, we have that
P = 1500, r = 4.3/100 = 0.043, n = 4, t = 6. Therefore,

\[A = $1,500(1+\frac{0.043}{4})^{4(6)}\approx $1,938.84\]
So, the balance after 6 years is approximately $1,938.84.

Answer 5

Rate for per year=8%
Rate per quarter=8/4%=2%
No. of quarters 3*4=12
\[A=3600\left( 1+\frac{ 2 }{100 } \right)^{12}\]
calculate