Question

$ 20,000 is invested at a rate of 5% compounded quarterly. Identify the compound interest function ta model the situation. Then find the balance after 5 years.

Answer 1

$25,640.74

Explanation:

The total compound interest is $5,640.74.

The final balance is $25,640.74.

with zero additional deposits

hope this helps:)

Answer 2

the balance after 5 years is: 26540.744

Explanation:

Given the information:

• P = initial balance = $ 20,000
• r = interest rate (decimal) = 5% = 0.05
• n = number of times compounded annually = 4
• t = time = 5

We have the compound interest function ta model the situation is:

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

<=> A =
`20000(1+(0.05)/(4) )^(4*5)`

<=> A = $26540.744

Hence, the balance after 5 years is: $26540.744