Answer: To calculate how many times Francisco will earn interest after keeping the money in the account for 5 years, we need to determine the number of quarters in 5 years.
Since there are 4 quarters in a year, the total number of quarters in 5 years is:
4 quarters/year x 5 years = 20 quarters
Therefore, Francisco will earn interest 20 times over the 5-year period.
To calculate the value of his account in 5 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = the principal amount (initial investment)
r = the annual interest rate (as a decimal)
n = the number of times the interest is compounded per year
t = the time the money is invested (in years)
In this case, P = $5,000, r = 0.03, n = 4 (since the interest is compounded quarterly), and t = 5. Substituting these values into the formula, we get:
A = $5,000(1 + 0.03/4)^(4x5)
A = $5,000(1.0075)^20
A = $5,866.02
Therefore, the value of Francisco's account in 5 years, if he does not make any additional deposits or withdrawals, will be $5,866.02.
Explanation: