Question

Paul bought $3,500 worth of government bonds that pay 3% interest compounded quarterly. If no money is deposited or withdrawn, how much will the bonds will be worth after 10 years?

Answer 1

To solve this problem, we can use the formula for compound interest:

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

where:

A = the amount of money after t years
P = the principal (initial amount invested)
r = the annual interest rate (in decimal form)
n = the number of times the interest is compounded per year
t = the number of years

In this case, P = $3,500, r = 0.03 (3%), n = 4 (compounded quarterly), and t = 10 years. Therefore,

A = $3,500 (1 + 0.03/4)^(4*10)
= $3,500 (1.0075)^40
= $4,872.24

Therefore, the bonds will be worth approximately $4,872.24 after 10 years, if no money is deposited or withdrawn.

Answer 2

Everything the bot does is correct until the last line, lol

....
$3,500 (1.0075)^40
= $4,719.22