Question

I need help ASAP it’s compound interest and I’m not very good at it

Answer 1

Part B:

5) She will have $4445.244256 in 3 years

Part C:

1) She will have $8081.130039 in 10 years

2) He will have $13360.55059 in 8 years

Explanation:

The formula of the compound interest is A = P
`(1+(r)/(n))^(nt)`, where

• A is the new value

• P is the initial amount

• r is the rate in decimal

• n is the number of the period

• t is the time in years

Part B:

5)

∵ P = $4250

∵ r = 1.5% = 1.5 ÷ 100 = 0.015

∵ n = 4 ⇒ Compounded quartly

∵ t = 3 years

→ Substitute them in the formula above

∴ A = 4250
`(1+(0.015)/(4))^(4(3))`

∴ A = 4250
`(1.00375)^(12)`

∴ A = 4445.244256

∴ She will have $4445.244256 in 3 years

Part C:

1)

∵ Grace deposits $6000

∴ P = 6000

∵ The account is compounded semi-annually at 3%

∴ r = 3% = 3 ÷ 100 = 0.03

∴ n = 2 ⇒ compounded semi-annually

∵ The time is 10 years

∴ t = 10

→ Substitute them in the formula above

∴ A = 6000
`(1+(0.03)/(2))^(2(10))`

∴ A = 6000
`(1.015)^(20)`

∴ A = 8081.130039

∴ She will have $8081.130039 in 10 years

2)

∵ Danial opens an account that is compounded semi-annually at 5%

∴ r = 5% = 5 ÷ 100 = 0.05

∴ n = 2 ⇒ compounded semi-annually

∵ He deposits $9000

∴ P = 9000

∵ The time is 8 years

∴ t = 8

→ Substitute them in the formula above

∴ A = 9000
`(1+(0.05)/(2))^(2(8))`

∴ A = 9000
`(1.025)^(16)`

∴ A = 13360.55059

∴ He will have $13360.55059 in 8 years