Use values from the compound interest table to find the compound interest. Round to the nearest cent.
-$800 at 6% compounded quarterly for 2 years
A)$98.88
B)$824.18
C)$96.00
D)$101.19

Question

Use values from the compound interest table to find the compound interest. Round to the nearest cent. 
-$800 at 6% compounded quarterly for 2 years
A)$98.88 
B)$824.18 
C)$96.00 
D)$101.19

Quizplus · Accepted Answer

The formula for compound interest is A = P(1 + r/n)^(nt), where P is the principal, r is the annual interest rate, n is the number of times interest is compounded per year, and t is the time in years. Here, P = $800, r = 0.06, n = 4, and t = 2. The compound amount A is $901.19, so the interest earned is $901.19 - $800 = $101.19.

Use Values from the Compound Interest Table to Find the Compound