Question

3. Gavin deposited $1500 into his savings account that is compounded quarterly at an interest rate of 1.5%. How much money will Gavin have after 5 years? Must show setup and answer for credit.

Answer 1

Answer:

Gavin will have amount of  $ 1528.335 in her account after 5 years

Step-by-step explanation:

Given as :

The principal amount deposited in account = $1500

The rate of interest compounded quarterly = 1.5 %

The time period = 5 years

Let The Amount after 5 years = A

From Compounded Interest method :

Amount = Principal × $(1+\frac{\textrm Rate}{4\times 100})^{\textrm 4\times Time}$

Or, A = $1500 × $(1+\frac{\textrm 1.5}{4\times 100})^{\textrm 4\times 5}$

Or, A = $1500 × $(1.00375)^{20}$

Or,  A = $1500 × 1.01889

∴    A = $ 1528.335

Hence Gavin will have amount of  $ 1528.335 in her account after 5 years Answer