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Fred invests $3000 at an apr of 4.70% compounded quarterly for 4 years. How much interest will the investment yield?

1 Answer

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Final answer:

The investment will yield $481.94 in interest.

Step-by-step explanation:

To calculate the amount of interest earned, we can use the formula A = P(1 + r/n)^(nt), where A is the final amount, P is the principal amount, r is the annual interest rate (expressed as a decimal), n is the number of times interest is compounded per year, and t is the number of years. Plugging in the values for this question, we have:

A = 3000(1 + 0.047/4)^(4*4) = $3481.94

Subtracting the original principal amount gives us the interest earned:

Interest = $3481.94 - $3000 = $481.94

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