Question

The mother of Kriz Anthony was hospitalized and he needs an

amount of P50,000 for the surgery. He decided to borrow money from the bank
with 5% interest rate compounded quarterly payable for 4 years How much
should Kriz pay at the end of the term?​

Answer 1

Answer: Kriz should pay $50,100 at the end of the term.

Explanation:

If the interest is compunded quarterly, then the accumulated amount after t years will be:

`A=P(1+(r)/(400))^(4t)` , where P= principal value , r = rate of interest .

Given: P= 50,000 , r= 5% = 0.05, t= 4 years

Then,

`A=50000(1+(0.05)/(400))^(4(4))\\\\= 50000(1+0.000125)^(16)\\\\=50000(1.000125)^(16)\\\\=50000(1.002)\\\\=\$50,100`

Hence, Kriz should pay $50,100 at the end of the term.