Suppose you invest $2,500 into a regular savings account with 2.95% annual interest rate that compounds quarterly. How much would your investment be worth in 10 years?

Question

Suppose you invest $2,500 into a regular savings account with 2.95% annual interest rate that compounds quarterly. How much would your investment be worth in 10 years?

1 Answer

Impact of this question

1426 views around the world

You can reuse this answer
Creative Commons License

Answer 1 · 2016-06-04T17:48:18

$$ 3554.18$ $$3554.18$

Explanation:

Principle = $$ 2500$ $$2500$
Interest rate = $2.95 %$ $2.95%$ = 0.0295
Time = 10 years
Compounding period = $T i m e \times 4$ $Time xx 4$ = 40

Thus interest rate = $0.0295 / 4$ $0.0295//4$ = 0.007375

$A = P {(1 + i)}^{n}$ $A = P(1+i)^n$
$A = 2500 {(1 + 0.007375)}^{40}$ $A = 2500(1+0.007375)^40$
$A = 2500 {(1.007375)}^{40}$ $A = 2500(1.007375)^40$
$A = 2500 (1.3416)$ $A = 2500(1.3416)$
$A = 3354.18$ $A = 3354.18$

Science

Math

Humanities

... and beyond

Suppose you invest $2,500 into a regular savings account with 2.95% annual interest rate that compounds quarterly. How much would your investment be worth in 10 years?

1 Answer

Explanation:

Related questions

Impact of this question