Question

4. Sarah moved 530,000 of her savings to a new investment account that earns 4% interest compounded quarterty. Write a function to model this situation, then find the amount of interest the account will earn after 12 years.​

Answer 1

`~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+(r)/(n)\right)^(nt) \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill &\$530000\\ r=rate\to 4\%\to (4)/(100)\dotfill &0.04\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{quarterly, thus four} \end{array}\dotfill &4\\ t=years \end{cases} \\\\\\ A=530000\left(1+(0.04)/(4)\right)^(4\cdot t)\implies A=530000(1.01)^(4t) \\\\[-0.35em] ~\dotfill`

`\stackrel{\textit{after 12 years}}{t=12}\implies A=530000(1.01)^(4(12))\implies A=530000(1.01)^(48) \\\\\\ A\approx 854479.82~\hfill \underset{\textit{interest in the account}}{\stackrel{854479.82~~ - ~~530000}{\approx 324479.82}}`