Question

Lynne invested 35,000 into an account earning 4% annual interest compounded quarterly she makes no other deposits into the account and does not withdraw any money. What is the balance of Lynne's account in 5years

Answer 1

Hello!

Lynne invested 35,000 into an account earning 4% annual interest compounded quarterly she makes no other deposits into the account and does not withdraw any money. What is the balance of Lynne's account in 5years

Data:

P = 35000

r = 4% = 0,04

n = 4

t = 5

P' = ?

I = ?  

We have the following compound interest formula

$P' = P*(1+\dfrac{r}{n})^{nt}$

$P' = 35000*(1+\frac{0,04}{4})^{4*5}$

$P' = 35000*(1+0,01)^{20}$

$P' = 35000*(1,01)^{20}$

$P' = 35000*(1.22019003995...)$

$P' \approx 42,706.66$

So the new principal P' after 5 years is approximately $42,706.66.  

Subtracting the original principal from this amount gives the amount of interest received:

$P' - P = I$

$42,706.66 - 35000 = \boxed{\boxed{7,706.66}}\end{array}}\qquad\checkmark$

________________________

I Hope this helps, greetings ... Dexteright02! =)