Problema Solution
How much money will there be in an account at the end of 4 years if $17000 is deposited at 3% interest compounded quarterly? (Assume no withdrawals are made.)
Answer provided by our tutors
P = $17,000 the principal
t = 4 years
r = 0.03 or 3% annual rate
m = 4 compounding period per year
i = 0.03/4 interest rate per period
n = 4*4 = 16 total number of compounding periods
A = future value
A = P(1 + i)^n
A = 17000(1 + 0.03/4)^16
A = $19,158.87
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there will be $19,158.87 at the end of 4 years.