Answer: the amount in the account would be $515.15
Step-by-step explanation:
Initial amount deposited into the account is $500 This means that the principal is
P = 500
It was compounded quarterly. This means that it was compounded four times in a year. So
n = 4
The rate at which the principal was compounded is 4%. So
r = 4/100 = 0.04
The money would be compounded for 9 months. So
t = 9 months = 9/12 = 0.75
The formula for compound interest is
A = P(1+r/n)^nt
A = total amount in the account at the end of t years. Therefore
A = 500 (1+0.04/4)^ 4 × 0.75
A = 500(1.01)^3= $515.15
