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6 March, 15:16

If A is the initial amount put into an account, P is the annual percentage rate of interest, which remains fixed, and the account compounds quarterly, which of the following is an expression, in terms of A and P, for the amount in the Account after 5 years?

A 4A (p100) 5

B A (p100) 20

C 4A (1+p100) 5

D A (1+p25) 20

E A (1+p400) 20

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  1. 6 March, 15:30
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    Answer: The amount in the account is A = A (1 + P/400) ^20

    Step-by-step explanation:

    Initial amount deposited into the account is A. This means that the principal is A, so

    P = A

    It was compounded quarterly. This means that it was compounded once in four months. So

    n = 4

    The rate at which the principal was compounded is P%. So

    r = P/100

    It was compounded for a total of 5 years. So

    n = 5

    The formula for compound interest is

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

    A = total amount in the account at the end of n years.

    Let A = B

    B = A (1 + (P/100) / 4) ^4*5

    A = A (1 + P/400) ^20
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