Question

use the formula for computing future value using compound interest to determine the value of an account at the end of 10 years if a principal amount of $10,000 is deposited in an account at an annual rate of 3% and the interest is compounded quarterly. The amount after ten years will be $_______ (round to the nearest cent as needed). A = P ( 1 + r/m) ^ n

Answer 1

Given:

P=$10000 : m=4 : r=0.03 : n=40

`A=P(1+(r)/(m))^n`
`A=10000(1+(0.03)/(4))^(40)`
`A=10000(1.0075)^(40)`
`A=10000(1.3483)`
`A=\text{ \$13483}`
`1\text{ \$= 100 cent}`
`A=13483*100`
`A=\text{ 1348300 cent}`

Therefore,The amount after ten years will be 1348300 cent.