Question

Find the balance in the account after the given period. $700 principal earning 2.25%, compounded quarterly, after 6 years

Answer 1

$800.87

Explanation:

The compound interest formula tells you the amount A resulting from investment of principal P at rate r compounded n times a year for t years:

A = P(1+r/n)^(nt)

Filling in the given numbers and doing the arithmetic, we get ...

A = $700(1 +.0225/4)^(4·6) ≈ $800.87

The account balance will be $800.87.