Question

Find the future value if $3,6000 is invested for 8 years at an annual rate of 7% compounded quarterly.

Answer 1

Answer:

$62,719.69

Step-by-step explanation:

$A=A_0(1+\frac{r}{n})^{nt}$

$n$ is the number of compoundings per year

$A_0$ is the initial amount

$A$ is the future amount

$t$ is the number of years

$r$ is the rate

We are given $A_0=3600$,

the number of years is $t=8$,

$n=4$ (it is being compounded quarterly),

and $r=.07$.

So let's plug this in:

$A=36000(1+\frac{.07}{4})^{4 \cdot 8}$

$A=36000(1.0175)^{32}$

Put left-hand side into the calculator:

$A=62719.69$