Question

You deposit $750 in a savings account the earns a 5% annual interest compounded quarterly.

Answer 1

Answer:

a. $A = P(1 + \frac{r}{n})^{nt}$

b .$914.85

Step-by-step explanation:

Step one:

given data

principal p=$750

rate= 5%= 0.05

for quarterly compounding n=4

a. the function that represents the balance after t years.

$A = P(1 + \frac{r}{n})^{nt}$

A = final amount

P = initial principal balance

r = interest rate

n = number of times interest applied per time period

t = number of time periods elapsed

b. when t=4

$A = 750(1 + \frac{0.05}{4})^{4*4}\\\\A= 750(1 +0.0125)^{16}\\\\A= 75(1.0125)^{16}\\\\A= 750*1.2198\\\\A=914.85$

A= $914.85