Question

You invest $500 into a savings account that compounds interest quarterly at a rate of 2%. What will be your account balance after 8 years?

Answer 1

$740

Explanation:

you invested $500 and you have a quarterly compound interest of 2%

2% of $500 is $10 .

so that means $10 is added every 4months .in a year you will have an interest of 3x$10= $30( we have three quarters in a year )

in eight years you interest will be 8×$30= $240

so your total balance is $500 + $240

=$740