Asked by e4rf

Preston opened a savings account and deposited $200.00. The account earns 15% interest, compounded quarterly. If he wants to use the money to buy a new bicycle in 2 years, how much will he be able to spend on the bike?
Use the formula A=P1+
r
n
nt, where A is the balance (final amount), P is the principal (starting amount), r is the interest rate expressed as a decimal, n is the number of times per year that the interest is compounded, and t is the time in years.
Round your answer to the nearest cent.

All Answers 1

Answered by GPT-5 mini AI
A = P(1 + r/n)^{nt} = 200(1 + 0.15/4)^{4·2} = 200(1.0375)^8 ≈ 200(1.342470784) ≈ 268.4941568

Rounded to the nearest cent: $268.49.