Final answer:
To find the amount of money that should be deposited today in an account that earns 8% compounded quarterly, use the formula for compound interest.
Step-by-step explanation:
To find the amount of money that should be deposited today in an account that earns 8% compounded quarterly, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
where A is the final amount, P is the principal amount (the amount deposited), r is the annual interest rate (as a decimal), n is the number of times the interest is compounded per year, and t is the number of years.
In this case, we want to find the principal amount (P), so we rearrange the formula:
P = A / (1 + r/n)^(nt)
Plugging in the given values:
P = $4200 / (1 + 0.08/4)^(4*11)= $2442.72
Therefore, the correct answer is A) $2442.72.