Question

Jacob has $4,800 to invest in a saving account. He receives a steady interest rate of 3. 35% compunded quarterly. He would like to save or the next 5 years and then take his money out. What would be his balace at the end of the 5 years?

$9,354. 20



$7,211. 74



$5,671. 30



$5,604. 0

Answer 1

5671.30

Explanation:

periods = 5 years quarterly = 20 periods

interest per period .0335/4 (4 periods per year)

initially 4800

FV = future Value = 4800 ( 1 + .0335/4)^20 = 5671.30