Explanation:
there are some tricks involved that your teacher tries to "play" with you.
overall, the question is, how much money is in the account after 2 years, when the originated deposit amount was $15,000, and its interest rate is 8% per year (!). and the interest is compounded (applied) quarterly (= 4 times a year).
the table tells us the multiplication factor FVIF for the original deposit to calculate the balance after n "applications" of the interest rate i.
in other words :
new balance = deposit × FVIF(i, n)
and the paid interest is simply
interest = new balance - deposit =
= deposit × (FVIF(i, n) - 1)
now, the tricks here are :
2 years quarterly means 2×4 = 8 interest application periods.
interest rate = 8% per year = 8/4 = 2% per quarter (interest application period).
so, we have to look in the table for the entry at
8 periods at 2% = 1.1717
the amount (balance) after 2 years is then
15,000 × 1.1717 = $17,575.50
the interest earned is then
17,575.50 - 15,000 = $2,575.50