Question

At the end of each quarter, Patti deposits $1,100 into an account that pays 12% interest compounded quarterly. How much will Patti have in the account in 4 years

Answer 1

Answer:

Future value = $22172.56

Explanation:

Below is the given values:

Deposit made at the end of each quarter = $1100

Interest rate = 12% or 12% / 4 = 3%

Number of year = 4years

Number of compounding period = 4 x 4 = 16

Future value = Annuity x [ (1 + r)^n - 1] / r

Future value = $1100 x  [ (1 + 3%)^16 - 1] / 3%

Future value = $22172.56