You deposit $4,600 in an account earning 2.5% interest compounded quarterly. How much will you have in the account after 8 years?
(Note: Use n=12 for monthly compounding, n=4 for quarterly compounding, n=2 for semiannual compounding, and n=1 for annual compounding.)
5082.31
4600(1+.025/4)^(4*8) = 5614.96
what formula did you use?
A=P(1+r/n)nt
How much more interest would you get in 4 years from 20% compounded monthly compared to 20% simple interest on a 3000 deposit?
To calculate the amount in the account after 8 years with quarterly compounding interest, you can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = principal (initial deposit)
r = annual interest rate (as a decimal)
n = number of times interest is compounded per year
t = number of years
In this case, the principal (P) is $4,600, the annual interest rate (r) is 2.5% (or 0.025 as a decimal), the number of times interest is compounded per year (n) is 4 (quarterly), and the number of years (t) is 8.
Substituting the values into the formula:
A = $4,600(1 + 0.025/4)^(4*8)
First, simplify the expression inside the parentheses:
A = $4,600(1 + 0.00625)^(4*8)
Combine the like terms:
A = $4,600(1.00625)^(32)
Calculate the exponent:
A = $4,600(1.20378125074)
Multiply the principal by the value obtained:
A = $5,517.26
Therefore, after 8 years, you will have approximately $5,517.26 in the account.