Question

Use the given information to find the amount A in the account earning compound interest after 6 years when the principa $3500. Round your answer to the nearest cent. r=2.16%, compounded quarterly

Answer 1

To find the amount in the account earning compound interest after 6 years, use the formula A = P(1 + r/n)^(nt). Plug in the given values and calculate the amount to the nearest cent.

Step-by-step explanation:

To find the amount in the account earning compound interest after 6 years, we can use the formula for compound interest: A = P(1 + r/n)^(nt), where A is the amount, P is the principal, r is the annual interest rate, n is the number of times the interest is compounded per year, and t is the number of years. In this case, the principal is $3500, the annual interest rate is 2.16% (or 0.0216 as a decimal), and the interest is compounded quarterly.

Using the formula, A = 3500(1 + 0.0216/4)^(4*6)= 3500(1.0054)^(24) = 3500(1.1459) = $4004.15.

Therefore, the amount in the account earning compound interest after 6 years is $4004.15 rounded to the nearest cent.