The owner of Oak Hill Squirrel Farm deposits $1,000 at the end of each quarter into an account paying 1.5% compounded quarterly. What is the value at the end of 8 years, 6 months? (Round your answer to the nearest cent.)
3 answers
don't you have a handy annuity formula?
I am not sure how to calculate the 8 years and 6 months.
Interest is applied quarterly, so over 8 years, it's applied 8 × 4 = 32 times.
Over the remaining 6 months, it's applied 2 more times because a quarter of a year is 3 months.
So we have 8 x 4 + 2 = 34 interest periods altogether.
Over the remaining 6 months, it's applied 2 more times because a quarter of a year is 3 months.
So we have 8 x 4 + 2 = 34 interest periods altogether.