SOLUTION: 7000 deposit compound interest compounded quarterly at 4.75% for 5 years

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Question 961178: 7000 deposit compound interest compounded quarterly at 4.75% for 5 years
Answer by KMST(5328) About Me  (Show Source):
You can put this solution on YOUR website!
The interest rate represents a ratio of 4.75 to 100:
%224.75%25%22=4.75%2F100=0.0475
There are 4 quarters in a year, so the interest paid each quarter will be
,
at the end of that quarter 0.011875x will be paid as interest.
Then, at the end of that quarter,
you will have a balance of x%2B0.011875x=%281%2B0.011875%29x=1.011875x .
If that happens every quarter for 5years=5%284quarters%29=20quarters ,
and your initial deposit is 7000 ,
you end up with
(rounded to the nearest cent).