Question

Phillip opened a savings account with an annual interest rate of 8% and an initial deposit of $3500. If his interest is compounded quarterly, how much is in Phillip’s account after 2 years? Round your answer to the nearest cent.

interest compounded quarterly: A= P (1 + r /4 ) to the power of 4 t

Answer 1

Using the formula:
A=P(1+r/100)^4t
where:
p=principle=$3500
t=terms in the given time period=2*4=8 terms
rate=8/4=2%
thus:
A=3500(1+2/100)^8
=$4100.81