P = Po*(1+r)^n.
Po = $3,000.
r = (3%/4)/100% = 0.0075 = Quarterly %
rate expressed as a decimal.
n = 4Comp./yr. * 5yrs. = 20 Compounding
periods.
Solve for P.
I = P-Po.
2. Suppose you obtain a $3,000 T-note with a 3% annual rate, paid quarterly, with maturity in 5 years. How much interest will you earn?
2 answers
67