Final answer:
To find out Josef's investment's worth in 12 years with compound interest, we use the A = P(1 + r/n)^(n*t) formula. The investment will be worth $71.26.
Step-by-step explanation:
To find out how much money Josef's investment will be worth in 12 years, we need to use the formula for compound interest. The formula is:
A = P(1 + r/n)^(n*t)
Where:
- A = the future value of the investment
- P = the principal (initial deposit)
- r = the interest rate (in decimal form)
- n = the number of times interest is compounded per year
- t = the number of years
In this case, Josef deposited $50, the interest rate is 3.25% or 0.0325 as a decimal, and the interest is compounded quarterly, which means n = 4. Plugging in these values, we get:
A = 50(1 + 0.0325/4)^(4*12) = $71.26
Therefore, Josef's investment will be worth $71.26 in 12 years if he makes no other deposits or withdrawals.