Rebecka borrowed $3500, 5000, 3500,& 4500 from her dad on September 1 of each of four successive years for college expenses. Rebecka and her dad agreed to a loan at the rate of 8.75% compounded quarterly. If it is now 2 years from the last day that she borrowed money, how much woruld Rebecka owe?

Question

The correct answer is $22,352.25
but i got the wrong answer, and the formula for this question is
FV=PV(1+i/4)^4*n

i=j/m
=8.75%/4
=0.021875

n= mt
=(4)(2)
= 8

FV=3500(1+.021875/4)^4*8
=4167.37

FV=5000(1+.021875/4)^4*8
=5953.40

FV=3500(1+.021875/4)^4*8
=4167.37

FV=4500(1+.021875/4)^4*8
=5358.05

then i sum all up and i get $19,646.19 and the answer should be $22,352.25
!!!

Answer 1

Assuming you placed the loans in the correct order,
the first $3500 earns interest for 20 periods (5 years)
the $500 earns interest for 16 periods (4 years)
the $3500 for 12 periods (3 years)
and the last $4500 for 8 periods (2 years)

You would need
4500(1.021875)^8 + 3500(1.021875)^12 + 5000(1.021875)^16 + 3500(1.021875)^20
= 20352.28

which is their answer.
I carried all my digits of my 10 digit calculator.

Answer 2

thnx Reiny!!! :-D