Question

Harry Morgan plans to make 30 quarterly deposits of $200 into a savings account. The first deposit will be made immediately. The savings account pays interest at an annual rate of 8%, compounded quarterly. How much will Harry have accumulated in the savings account at the end of the seven and a half-year period

Answer 1

Harry would have accumulated $12,170.42

Step-by-step explanation:

Giving the following information:

Harry Morgan plans to make 30 quarterly deposits of $200 into a savings account. The savings account pays interest at an annual rate of 8%, compounded quarterly.

To calculate the ending value of the investment, we need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= quarterly deposit= 300

n= 30

i= 0.08/4=0.02

FV= {300*[(1.02^30)-1]}/0.02= $12,170.42