Brooke Puts 400.00 into an account to use for school expenses the account earns 14%interest compounded quarterly how much will be in the account after 5 years

Respuesta :

According to the problem, the principal is 400, the interest rate is 14%, the time is 5 years, and it's compounded quarterly which means there are 4 compound periods each year.

We have to use the compound interest formula.

[tex]A=P(1+\frac{r}{n})^{nt}[/tex]

Replacing the given values, we have.

[tex]\begin{gathered} A=400(1+\frac{0.14}{4})^{4\cdot5} \\ A=400(1+0.035)^{4\cdot5} \\ A=400(1.035)^{20} \\ A\approx795.92 \end{gathered}[/tex]

Hence, after 5 years, there will be $795.92, approximately.