Question 1041191
3% is the apr.
this is equal to an annual interest rate of .03.
divide that by 12 to get the monthly interest rate of .03/12 = .0025.
that's your periodic interest rate.


formula for future value of a present amount is:
f = p * (1+r)^n
f is the future value
p is the present amount
r is the interest rate per time period.
n is the number of time periods.


your time periods are months.
the interest rate per month is the annual interest rate / 12.
the number of time periods is the number of years * 12.


you get:
r = .0025
n = 4*12 = 48
p = 3250


formula of f = p * (1+r)^n becomes:


f = 3250 * (1.0025)^48 = 3663.816068