Alex is using Excel to calculate the compound interest he will receive on an investment. His investment accrues interest on a quarterly basis. If the yearly interest rate is 8% and stored in Cell B3, what formula should Alex use to calculate the 1st quarter interest rate?
A) =B3/3
B) =B3/4
C) =B3*3
D) =B3*4

Question

Quizplus · Accepted Answer

Since the investment accrues interest on a quarterly basis, Alex needs to divide the yearly interest rate by 4 (the number of quarters in a year) to get the quarterly interest rate. Therefore, the formula to calculate the 1st quarter interest rate is =B3/4.

Alex Is Using Excel to Calculate the Compound Interest He