Question

in order Do you say for the new iPhone a student starts a savings account with an initial deposit of $200 the count pay 6% interest compounded quarterly if the student at no additional money to the account and takes no money out of the account how much will be in the account after five years?

Answer 1

Given the information, we have that the present value is $200, the rate is 6% compounded quarterly, then (6%)/4=1.5%. We want to know how much money there will be after 5 years, then, using the compound interest formula we have:

$FV=PV(1+r)^n$

Where:

FV=Future Value

PV=Present Value

r=rate

n= periods

Using the information at hand, we get:

$FV=200(1+0.015)^5=200(1.077284004)=215.45$

Therefore, there will be 215.45 dollars after 5 years