Question

You invest $20,000 in an investment account that promises a 6% annual interest, compounded quarterly (that is, four times a year). How much can you expect to have in the account after 1 year? (round to the nearest dollar)

Answer 1

A=p (1+r/k)^kn
A future value
P present value 20000
R interest rate 0.06
K compounded quarterly 4
N time 1 year

A=20,000×(1+0.06÷4)^(4×1)
A=21,227.27