Question

You deposit $6,800 in a money-market account that pays an annual interest rate of 5.7%. The interest is compounded quarterly. How much money will you have after 3 years?

Answer 1

If you deposit(P) $6,800 in a money-market account that pays an annual interest rate(r) of 5.7%. The interest is compounded quarterly(4). [ The money you have after 3 years(t) is: Using the compound interest formula A=P(1+r/n)^nt, where P=$6800, r=57%=.057,t=+3, n=4. A=$6,800(1+(0.057/4))^(3x4) =$6,800(1+0.01425)^12 =$6,800(1.01425)^12 =$6,800(1.18505961016) =$8,058.41. ]