SOLUTION: If $15,000 is invested and interest is compounded quarterly, determine the amount of the investment after 3 years for the given interest rates. (Round your answers to two decimal p

Algebra ->  Logarithm Solvers, Trainers and Word Problems -> SOLUTION: If $15,000 is invested and interest is compounded quarterly, determine the amount of the investment after 3 years for the given interest rates. (Round your answers to two decimal p      Log On


   

Question 870436: If $15,000 is invested and interest is compounded quarterly, determine the amount of the investment after 3 years for the given interest rates. (Round your answers to two decimal places.)
8.5 percent
6.5 percent
6 percent
5.5 percent

I thought I was doing it right but they are wrong. I was using the formula A(1/4)=P(1+r/4)
Answer by ewatrrr(24785) About Me  (Show Source):
You can put this solution on YOUR website!


Hi

 In General A%28t%29+=+P%281%2Br%2Fn%29%5E%28nt%29

A = Accumulated Amount

P= principal = $15,000

r= annual rate = .085 (for ex)

n= periods per year = 4 (compounded quarterly)

t= years = 3

A = $15,000(1 + .085/4)^(4*3)

A = $15,000(1.02125)^(12)

etc as Annual Interest rate changes