How much will $8,000 grow to in five years,assuming an interest rate of 8% compounded quarterly?

Question

Quizplus · Accepted Answer

We can use the formula for compound interest:

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

Where: 
A = final amount 
P = principal (initial amount) 
r = annual interest rate (as a decimal) 
n = number of times interest is compounded per year 
t = time (in years)

Plugging in the values given:

A = 8,000*(1 + 0.08/4)^(4*5)

A = 8,000*(1.02)^20

A = $11,888

Therefore, the best choice is (C).

How Much Will $8,000 Grow to in Five Years,assuming an Interest