Solve the problem.
-At the end of every 3 months, Judy deposits $100 into an account that pays 6% compounded quarterly. After 4 years, she puts the accumulated amount into a certificate of deposit paying 7.5% compounded semiannually for
1 year. When this certificate matures, how much will Judy have accumulated?
A) $1930.25
B) $1823.20
C) $1920.96
D) $2072.31

Question

Quizplus · Accepted Answer

The correct answer is A.The amount Judy has accumulated after 4 years of depositing $100 every 3 months into an account that pays 6% compounded quarterly is:$100 * (1 + 0.06/4)^(4*4) = $100 * (1.015)^16 = $1104.85The amount Judy has accumulated after 1 year of putting the accumulated amount into a certificate of deposit paying 7.5% compounded semiannually is:$1104.85 * (1 + 0.075/2)^2 = $1104.85 * (1.0375)^2 = $1185.40Therefore, the total amount Judy has accumulated is $1104.85 + $1185.40 = $1930.25.

Solve the Problem. -At the End of Every 3 Months, Judy Deposits $100