Question

An investment of $7.560 earns interest at the ate of 5% and is compounded quarterly. What is the accumulated value of the investment at the of 9years.

Answer 1

FV= $11,823.42

Explanation:

Giving the following information:

Initial investment= $7,560

Interest rate= 0.05 / 4= 0.0125

Number of periods= 9*4= 36 quarters

To calculate the future value, we need to use the following formula:

FV= PV*(1+i)^n

FV= 7,560*(1.0125^36)

FV= $11,823.42