Question

Find the compound interest earned by the deposit of $1800 at 6% compounded quarterly for 6 years.

$648.00
$753.33
$1,968.20
$773.11

Please help me out, i really can't seem to figure this out. If you could show me how you do it along with the answer it'd be really helpful

Answer 1

The equation for the problem is x(1+r)^t

X is the original deposit
R is the rate or percentage of growth
T is the time, in years

X=1800
R=.06
T= 6

F(x)=1800(1+.06)^6
=1800(1.06)^6
=1800(1.41852)
=2533.3344

The above is the future value of the money, to find out how much was gained by interest just subtract the original investment of 1800

2533.3344-1800=753.3344

So the answer is B