Answer:
The amount in the account at the end of the 2nd quarter is $1537.73 ⇒ 2nd answer
Step-by-step explanation:
* Lets revise the compound interest
- Compound interest can be calculated using the formula
A = P (1 + r/n)^(nt)
Where:
• A = the future value of the investment, including interest
• P = the principal investment amount (the initial amount)
• r = the annual interest rate (decimal)
• n = the number of times that interest is compounded per unit t
• t = the time the money is invested for
* Now lets solve the problem
# P = $1500
# r = 5/100 = 0.05
# n = 4 ⇒ quarterly compound
# t = 1/2 ⇒ two quarters means 1/2 year
∴ A = 1500(1 + 0.05/4)^(4 × 1/2) = $1537.73
* The amount in the account at the end of the 2nd quarter is $1537.73
