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monitta
3 years ago
8

Suppose you buy a CD for $900 that earns 8% APR and is compounded quarterly. The CD matures in 3 years. Assume that if funds are

withdrawn before the CD matures, the early withdrawal fee is 3 months' interest. What is the early withdrawal fee on this account?
Mathematics
1 answer:
Dmitriy789 [7]3 years ago
3 0
A=p(1+i/m)^mn
A=900×(1+0.08÷4)^(4×3/12)
A=918
I=900-918=18
So the early withdrawal fee is 18
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