If $4,000 is deposited in a bank account paying 4% compounded quarterly, what amount will be in the account after 7 years? How much interest will be returned during the 7 years?

Question

Mathematics

Janessa Case

25 April, 00:08

If $4,000 is deposited in a bank account paying 4% compounded quarterly, what amount will be in the account after 7 years? How much interest will be returned during the 7 years?

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Antonio Chavez · Answer 1

We shall use the equation A = i (1 + r/n) ^nt

So we shall plug all of that in so it turns out like this:

A = 4000 (1 + 0.04/4) ^4 x 7

So then that can be simplified to A = (1.01) ^28

and then to A = 4000 (1.321)

so then A = 5285.16