Ask Question
16 July, 01:38

Use the compound interest formula for compounding more than once a year to determine the accumulated balance after the stated period. $1200 deposit at an APR of 4% with quarterly compounding for 2 years.

+2
Answers (1)
  1. 16 July, 01:58
    0
    1299.43

    Explanation: {'=raise to the power}

    A = P (1+r/n) 'nt

    A = final amount, P = principal amount, r = rate of interest per time, n = no of time periods, t = no of times interest compounds in a time period.

    In this case: A=?, P = 1200, t = year, n = no of years i. e 2, t = compounding in a year i. e 4 times (quarterly), r = APR 4%.

    A = 1200 (1 + 0.04/4) ' (2x4)

    = 1200 (1 + 0.01) ' (2x4)

    = 1200 (1.01) '8

    = 1200 (1.083)

    = 1299.43
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Use the compound interest formula for compounding more than once a year to determine the accumulated balance after the stated period. $1200 ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers