Question

You deposit $2200 in an account that pays 3% annual interest. After 15 years, you withdraw the money, what is the balance if the interest is compounded quarterly?

so I figure you would get 2650.00 help please

Answer 1

What you probably did was calculated <i>simple</i> interest for 15 years on $1000 and added to $2200 to give $2650.

Compound interest formula are based on the number of <i>periods</i>, n, the interest was compounded.

The interest being compounded 4 times a year, so there are 15*4=60 periods of 3 months each. The corresponding interest rate for <i>each</i> period is therefore r = 3%/4=0.0075.

The formula for the future value using compound interest is:
FV = Principal * (1+r)^n
=2200*1.0075^60
=2200*1.565681
=$3444.50