Final answer:
The deposits will amount to $122.79 if interest is 4% compounded quarterly.
Step-by-step explanation:
The deposits will amount to $122.79 if interest is 4% compounded quarterly.
Compound interest is calculated using the formula:
A = P(1 + r/n)^(nt)
where:
A = the final amount
P = the principal (initial deposit)
r = the interest rate per period
t = the number of periods (in this case, 13 since deposits are made at the end of every quarter for 3.25 years)
n = the number of compounding periods per year (4 since interest is compounded quarterly)
Plugging in the values:
A = 116(1 + 0.04/4)^(4 * 3.25)
A = 116(1 + 0.01)^(13)
A = 116(1.01)^(13)
A = 116 * 1.13492367
A = 122.79