SOLUTION: Please Help: Find the compound amount for the deposit. Round to the nearest cent. $300 at 7% compounded quarterly for 2 years A) $310.59 B) $343.47 C) $342.00 D) $344.6

Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: Please Help: Find the compound amount for the deposit. Round to the nearest cent. $300 at 7% compounded quarterly for 2 years A) $310.59 B) $343.47 C) $342.00 D) $344.6      Log On

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Question 201923: Please Help:
Find the compound amount for the deposit. Round to the nearest cent.
$300 at 7% compounded quarterly for 2 years
A) $310.59
B) $343.47
C) $342.00
D) $344.66
Answer by jim_thompson5910(35256) About Me  (Show Source):
You can put this solution on YOUR website!
A=p%281%2Br%2Fn%29%5E%28n%2At%29 Start with the compound interest formula


A=300%281%2B0.07%2F4%29%5E%284%2A2%29 Plug in p=300 (the principle), r=0.07 (this is the decimal form of 7% interest), n=4 (since it is compounded quarterly), and t=2 (for 2 years)



A=300%281%2B0.0175%29%5E%284%2A2%29 Divide 0.07 by 4 to get 0.0175


A=300%281%2B0.0175%29%5E%288%29 Multiply the exponents 4 and 2 to get 8


A=300%281.0175%29%5E%288%29 Add 1 and 0.0175 to get 1.0175


A=300%281.14888%29 Raise 1.0175 to the 8 th power to get 1.14888


A=344.664 Multiply 300 and 1.14888 to get 344.664


So if you invest $300 at an interest rate of 7%, which is compounded quarterly for 2 years, the return is about $344.66 (which is rounded to the nearest cent)


So the answer is D)