Question

2.

Tom Mathis deposited $1850 in a new credit union savings acu
earns 7.25% interest compounded quarterly. Hem
amount in his account at the end of 6 months?
redit union savings account on the first of a quarter. The principal
y. He made no other deposits or withdrawals. What was the

Answer 1

The amount after 6 months compounded quarterly is $1917.66 .

Explanation:

Given as :

The principal amount deposited in account = $1850

The bank applied rate of interest = r = 7.25% compounded quarterly

The time period of loan = t = 6 months = 0.5 years

Let the Amount after 6 months = $A

Now, From quarterly Compound Interest method

Amount = principal ×
`(1+(\textrm rate)/(4* 100))^(4* time)`

Or, A = p ×
`(1+(\textrm r)/(4* 100))^(4* t)`

Or, A = $1850 ×
`(1+(\textrm 7.25)/(4* 100))^(4* 0.5)`

Or, A = $1850 ×
`(1.018125)^(2)`

Or, A = $1850 × 1.036578

∴ A = $1917.66

i.e A = $1917.66

So, The amount after 6 months = A = $1917.66

Hence, The amount after 6 months compounded quarterly is $1917.66 . Answer