Homework Help: Alg 2

Posted by rock on Tuesday, December 13, 2011 at 11:19am.

Suppose you deposit a principal amount of p dollars in a bank account that pays compound interest. If the annual interest rate r (expressed as a decimal) and the bank makes interest payments n times every year, the amount of money A you would have after t years is given by

Find the account balance after 20 years if you started with a deposit of $1000, and the bank was paying 4% interest compounded quarterly (4 times a year). Round your answer to the nearest cent.

I used the formula A(t)=P(1+ r/n)nt
and got 1010 and this is not the correct answer...

Alg 2 - Steve, Tuesday, December 13, 2011 at 12:58pm
A(t)=P(1+ r/n)^nt
A(20) = 1000(1.013333)^80
= 1000 * 13.7795
= 1377.95

Don't know how you plugged in your numbers to get 1010.
Alg 2 - correction - Steve, Tuesday, December 13, 2011 at 1:03pm
Rats! I compounded 3x/year, not 4.

A(t)=P(1+ r/n)^nt
A(20) = 1000(1.01)^80
= 1000 * 2.21671
= 2216.71

Answer this Question

Related Questions

Alg2 - Help....Help... Suppose you deposit a principal amount of p dollars in a ...
algebra - The formula for calculating the amount of money returned for an ...
math - The formula for calculating the amount of money returned for an initial ...
math - We deposited 7,500 dollars into a savings account which pays 3.6 percent ...
College Algebra~ Check answer please - Can someone check my answers please. The ...
Compound interest - Hello My teacher skipped over this and I have no clue how to...
Word problem - suppose you deposit $350 in a bank account that pays 6% annual ...
math - Suppose $500 is divided into two bank accounts. One account pays 15% ...
Economics - Finance - If your bank pays 5.5 percent interest on savings deposits...
pre algebra 6th grade - Tara's bank account contains $250.00. She made only ...

For Further Reading

First Name:
School Subject:
Answer: