quarterly means four compounding periods per year
... each at a quarter of the full interest rate
a = 5000 [1 + (.04 / 4)]^(10 * 4)
You put $5,000 in an account that is compounded quarterly. The annual interest rate, r, is 4%. How much will be in the account after 10 years?
A.$5,523.11
B.$5,747.37
C.$7,444.32
D.$24,005.10
I've tried this so many times and I have no idea please help!
2 answers
P = Po(1+R)^n,
R = 0.04/4 = 0.01 = quarterly % rate expressed as a decimal.
n = 10yrs * 4comp./yr. = 40 compounding periods.
P = 5000(1+0.01)^40 = $7444.32.
R = 0.04/4 = 0.01 = quarterly % rate expressed as a decimal.
n = 10yrs * 4comp./yr. = 40 compounding periods.
P = 5000(1+0.01)^40 = $7444.32.