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Kailyn invested $1500 at 8% compounded quarterly for 3 years. Find the value of the account balance (to the nearest cent) at the end of this investment.

1 Answer

3 votes

Answer:

$1938.84

Explanation:

To solve this problem, we can use the formula for compound interest:

A = P(1 + r/n)^(nt)

Where:

A = the account balance after the investment period

P = the initial investment amount

r = the interest rate (as a decimal)

n = the number of times the interest is compounded per year

t = the number of years the investment is held

Plugging in the values we have:

P = $1500

r = 8% or 0.08 (decimal)

n = 4 (compounded quarterly)

t = 3

A = 1500(1 + 0.08/4)^(4*3)

A = 1500(1.02)^12

A = $1938.84

Therefore, the value of the account balance at the end of the investment is $1938.84.

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