Question

Lynne invested $35,000 into an account earning 4% annual interest compounded quarterly. She makes no other deposits into the account and does not withdraw any money.

What is the balance of Lynne's account in 5 years?



$37,153.21

$39,438.88

$42,706.65 <my choice

$56,295.30

Answer 1

Correct!

Answer 2

P' = P*(1+r/n)^{nt}
P' = 35000*(1+0,04/4)^{4*5}
P' = 35000*(1+0,01)^{20}
P' = 35000*(1,01)^{20}
P' = 35000*(1.22019003995...)
P' = 42,706.65