Question

Danielle has a CD at Crossland Bank. She invests 21,350 for five years at 4.75% interest, compounded quarterly. What is her ending balance?

Answer 1

@amistre64

Answer 2

My standard response to questions like these is: "What's the formula for compound interest?" Mind typing that in?

Here, A = Amount (accumulation)
P= Principal (starting amount)
N= number of times interest is paid/compounded per year
t= number of years during which interest accumulates

Answer 3

r = interest rate, as a decimal fraction

Answer 4

I've tried three times with the formula.

Answer 5

Using a calculator? What kind?

Answer 6

TI-30XS

Answer 7

If you have the formula at hand, please type it out here.
Then we'll go through the calculations on your calc.

Answer 8

Okay.

Answer 9

I believe for this problem it would be: A=P (1+r/n)^nt?

Answer 10

that's great. thanks for typing it in.

Let's start with the interest rate. your rate is 4.75%. convert that to a decimal fraction and then divide the result by 4.

Answer 11

We divide by 4 because compounding occurs quarterly here.

Answer 12

A=245,000(1+0.69)^12?

Answer 13

Lol, now I see what I did wrong, nevermind. Thank you.

Answer 14

Important: Note that we've started with the stuff INSIDE parentheses. Assume you're familiar with "order of operations" rules.
Unfort., that expression is not quite correct. Pleae be patient and go thru the ops with me.

r/n = 0.0475/4 = ?

Answer 15

Want to try this on your own, or still interested in my help?