Find the compound amount for the deposit. Round to the nearest cent.
-$600 at 8% compounded quarterly for 5 years
A) $840.00
B) $881.60
C) $662.45
D) $891.57

Question

Quizplus · Accepted Answer

The compound amount can be calculated using the formula A = P(1 + r/n)^(nt), where A is the amount of money accumulated after n years, including interest, P is the principal amount ($600), r is the annual interest rate (8% or 0.08), n is the number of times that interest is compounded per year (quarterly, so 4 times), and t is the time the money is invested for (5 years). Plugging in the values: A = 600(1 + 0.08/4)^(4*5) = 600(1 + 0.02)^20 ≈ $891.57.

Find the Compound Amount for the Deposit