Question

A person invests 3,500 at 5.2 percent annual interesrt compounded quarterly. how much will this investment be worth at the end of year 1 ?

please show me how you did it

Answer 1

3685.58 to 2 d.p.

Explanation:

To find out the interest compounded quarterly you have to use the formula:

A = P ( 1 + r / 4 ) ^ 4t

A is the total amount

P is the initial amount

r is the rate of interest in decimal

t is the time in years

A = 3,500 ( 1 + 0.052 / 4 ) ^ 4 * 1

A = 3685.58 to 2 d.p.

Hope this helps. It may not be correct but I tried my best.