Question

Use the formula for compound amount to find the compound amount:$28,000 at 9% compounded quarterly for 1 year

Answer 1

Given:

`\begin{gathered} P=\text{ \$28,000} \\ r=9\text{ \% = }(9)/(100)=0.09 \\ t=1\text{year} \\ n=4 \end{gathered}`

To get the compound amount, we use the compound interest formula;

`A=P(1+(r)/(n))^(nt)`

Substituting the given values into the formula;

`\begin{gathered} A=28000(1+(0.09)/(4))^(4*1) \\ A=28000(1+0.0225)^4 \\ A=28000(1.0225)^4 \\ A=28000*1.0225^4 \\ A=\text{ \$30,606.33} \end{gathered}`

Therefore, the compound amount is $30,606.33