Answer:
The graduate will have $4,084.97 when he cashes in the CD at the end of the 36-months.
Step-by-step explanation:
This can be determined using the formula for calculating the future value (FV) formula as follows:
FV = PV * (1 + r)^n ................................. (1)
Where;
FV = Future value or the amount the graduate will have at end of 36 months = ?
PV = Present value or the total amount invested = Cash gifts from friends and relatives + Amount of 3 scholarships he received = $900 + $250 + $300 + $1,400 = $2,850
r = daily interest rate = 1% / 360 = 0.01 / 360 = 0.0000277777777777778
n = number of days = 36 months * 360 days = 12,960
Substituting the values into equation (1), we have:
FV = $2,850 * (1 + 0.0000277777777777778)^12,960
FV = $2,850 * 1.43332224806396
FV = $4,084.96840698229
Approximating to the nearest cent as required, we have:
FV = $4,084.97
Therefore, the graduate will have $4,084.97 when he cashes in the CD at the end of the 36-months.
