Posted by **Jim** on Friday, January 25, 2013 at 3:56pm.

A $20,000 deposit was placed in a bank paying 5.75% interest compounded quarterly. After 12 months, how much interest was earned.

- Math -
**Henry**, Saturday, January 26, 2013 at 7:10pm
P = Po(1+r)^n.

Po = $20,000

r = (5.75%)/4) / 100% = 0.014375 =

Quarterly % rate expressed as a decimal.

n = 4Comp/yr * 1Yr=4Compounding periods.

Plug the above values into the given Eq

and solve for P. P = $21,175.04.

Int. = P-Po.

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