Question

Hello! Can someone please help me solve this? its very hard for me.

Answer 1

16990.616 $ you can expect to have in your account after five years.

Explanation:

Given that,

Amount invested is principal amount (p) = $ 15000

Annual rate of interest (r) = 2.5% = 0.025

Compounded quarterly (n) = 4

Sum of the amount after 5 years (t)

We know that from compound interest formula,

`\text { Final amount }(\mathrm{A})=P\left(1+(r)/(n)\right)^(n t)`

To find the final amount substitute the given values in the above formula,

`\text { Final amount }(\mathrm{A})=15000\left(1+(0.025)/(4)\right)^(4 * 5)`

`\text { Final amount }(\mathrm{A})=15000\left(1+6.25 * 10^(-3)\right)^(20)`

`\text { Final amount }(\mathrm{A})=15000(1.00625)^(20)`

`\text { Final amount }(\mathrm{A})=15000 * 1.132707738`

Final amount (A) = 16990.62

The final amount that he can expect is $ 16990.62.