Question

Find the balance in an account with $7,000 principal earning 5% interest compounded quarterly

after 10 years. Round your answer to the nearest hundredth if necessary.

**SHOW YOUR WORK PLEASE

Answer 1

The balance is
`\$11,505.34`

Explanation:

we know that

The compound interest formula is equal to

`A=P(1+(r)/(n))^(nt)`

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest in decimal

t is Number of Time Periods

n is the number of times interest is compounded per year

in this problem we have

`t=10\ years\\ P=\$7,000\\ r=0.05\\n=4`

substitute in the formula above

`A=\$7,000(1+(0.05)/(4))^(4*10)=\$11,505.34`