Question

Find the compound amount and interest on ℎ 15,500,00 for 4 and 3 ℎ at 4%, converted quarterly.

Answer 1

Compound Interest Formula:

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

Where:

A = amount (principal + interest)

P = principal

r = rate in decimal

n = number of compounding periods per unit of time

t = time in decimal years

So:

A = 15500x(1 + 0.04/4)^(4x4.25)

A = 18356.72

Interest = Amount - Principal

I = 18356.72 - 15500.00

I = 2856.72