chad's commission rate is 12%. He invests his commission from the sale of $9000 worth of merchandise at an interest rate of 8%, compounded quarterly. How much is Chad's investment worth after 6 months?

Question

chad's commission rate is 12%.  He invests his commission from the sale of $9000 worth of merchandise at an interest rate of 8%, compounded quarterly.  How much is Chad's investment worth after 6 months?

Damon · Answer

.12 * 9000 = 1080 invested interest rate per quarter = 8/4 = 2% two quarters is six months so 1.02 * 1.02 = 1.0404 1.0404 * 1080 = $ 1123.63

Reiny · Answer

commission = .12(9000) = 1080 1080(1.02)^2 = ... ( rate = .08/4 = .02 , number of quarters in 6 months = 2 )