To compound $100 quarterly for 20 years at 8%,we must use

Name: To compound $100 quarterly for 20 years at 8%,we must use
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Question

Quizplus · Accepted Answer

Compounding $100 quarterly for 20 years at an 8% annual interest rate means the interest is compounded four times a year (quarterly) for 20 years. Therefore, there are 20 years * 4 quarters/year = 80 periods. The annual rate of 8% divided by 4 (for quarterly compounding) gives a 2% rate per period.

To Compound $100 Quarterly for 20 Years at 8%,we Must