Question

Mr. Ellis deposited $3,700 into a savings account for which interest is compounded quarterly at a rate of 1.84% how much interest will he earn after 6 years

Answer 1

A=p (1+I/k^kn

A future value ?
P principle 3700
i interest rate 0.0184
K compounded quarterly 4
N time 6 years

A=3,700×(1+0.0184÷4)^(4×6)
A=4,130.84

Interest earned=A-p
4,130.84−3,700=430.84

Hope it helps:-)

Answer 2

The interest is equal to
`\$430.84`

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=6\ years\\ P=\$3,700\\ r=0.0184\\n=4`

substitute in the formula above

`A=\$3,700(1+(0.0184)/(4))^(4*6)=4,130.84`

Find the interest

`I=A-P`

substitute

`I=\$4,130.84-\$3,700=\$430.84`