230k views
4 votes
22. Find the balance in an account with $900 earning 6.5% compounded
quarterly after 4 years

1 Answer

4 votes

Answer:

$1,164.80

Explanation:

Lets use the compound interest formula provided to solve this:


A=P(1+(r)/(n) )^(nt)

P = initial balance

r = interest rate (decimal)

n = number of times compounded annually

t = time

First, we need to change 6.5% into a decimal:

6.5% ->
(6.5)/(100) -> 0.065

Since the interest is compounded quarterly, we will use 4 for n. Lets plug in the values now:


A=900(1+(0.065)/(4))^(4(4))


A=1,164.80

The balance after 4 years will be $1,164.80

User Glasses
by
6.0k points