SOLUTION: I am having a diffcult time finding the correct anser to the following question. How much interest is earned in 3 years on $2000 deposited in an account paying 6% interest, compou

Question 758794: I am having a diffcult time finding the correct anser to the following question.
How much interest is earned in 3 years on $2000 deposited in an account paying 6% interest, compounded quarterly?
Found 2 solutions by John10, solver91311:
Answer by John10(297) (Show Source): You can put this solution on YOUR website!
Hi,
First, you need to find the accumulated amount after 3 years:
A = P(1 + r/n)^(nt)
A = 2000(1 + 0.06/4)^(4 * 3)
After found A, the interest is
I = A - $2000
Hope it helps you
John (Email me if you need extra help with your math class)

Answer by solver91311(24713) (Show Source): You can put this solution on YOUR website!

Part of your difficulty is trying to find an "anser". Nobody knows what that is. You will do much better looking for an answer.

Where is the future value, is the present value, is the interest rate expressed as a decimal, is the number of compounding periods per year, and is the number of years.

For you, , , , and .

The amount of the interest is then .

Just plug in the numbers and do the arithmetic.

John

Egw to Beta kai to Sigma
My calculator said it, I believe it, that settles it

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