Final answer:
To find the future value of $1,000 compounded weekly at a rate of 2.5% for 4 years, we use the compound interest formula. Plugging in the values, the amount would be worth $1,109.60.
Step-by-step explanation:
Using the compound interest formula, you can calculate the future value of an initial amount compounded weekly at a given interest rate over a certain number of years.
To find the future value of $1,000 compounded weekly at a rate of 2.5% for 4 years, we use the compound interest formula:
FV = PV(1 + r/n)^(nt)
where FV is the future value, PV is the present value, r is the interest rate, n is the number of times interest is compounded per year, and t is the number of years.
Plugging in the values, we have:
FV = $1,000(1 + 0.025/52)^(52*4)
= $1,000(1.000480769)^208
= $1,000 * 1.1096
= $1,109.60
Therefore, an initial value of $1,000 compounded weekly at 2.5% for 4 years would be worth $1,109.60.