Question

Anthony deposits $6,000 into an account that pays 5.6% annual interest and is

compounded quarterly. Find the balance in his account after 7 years?

Answer 1

$6,376.59

Explanation:

Using the compound interest formula;

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

A = 6000(1+0.056/(1/3))^(0.056)(7)

A = 6000(1+0.056(3))^0.392

A = 6000(1+0.168)^0.392

A = 6000(1.168)^0.392

A = 6000(1.06277)

A = $6,376.59

Hence the balance in his account after 7 years is $6,376.59