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A young graduate looks to save money to buy a house 8.00 years from today. He is somewhat conservative and will invest his money in a bond fund that pays 5.00% APR with quarterly compounding. The graduate invests $10,880.00 today. How much will his account be worth in 8.00 years?

User Rbarriuso
by
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1 Answer

5 votes

Answer:

amount = $10923.60

Step-by-step explanation:

given data

time t = 8 year

rate r = 5 %

principal P = $10,880.00

solution

we will use here amount formula that is

amount = principal ×
(1+(r)/(100))^(t) ...............................1

put here value we get and we get the amount that is

amount = $10880 ×
(1+(0.05)/(100))^(8)

amount = $10923.60

so his account be worth in 8.00 years is $10923.60

User Rocshy
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