How much money will there be in an account at the end of 7 years if $2000 is deposited at 5% interest compounded quarterly question markquarterly? (Assume no withdrawals are made.) What is the amount at the end 7 years?

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528 viewsOctober 8, 2016

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Darshita 6.14K October 8, 2016 0 Comments

How much money will there be in an account at the end of 7 years if $2000 is deposited at 5% interest compounded quarterly question markquarterly? (Assume no withdrawals are made.)

What is the amount at the end 7 years?

1 Answer

score 0 · Answer 1 · 2016-10-08T04:23:33+00:00

Answer: the amount at the end 7 years =$ 2831.98

Working notes for the above answer is as under

A = p ( 1+r/m)mt

Here,

A = Accumulated Amount P= principal = $2,000

r= annual rate = .05

m= periods per year = 4

t= years = 7Base amount: $2,000.00
Interest Rate: 5%
Effective Annual Rate: 5.09%
Calculation period: 7 years Now we put all this figure in to the formula as followA = 2000 ( 1+0.05/4)7*4A =2000(1+0.0125)28A=2831.98

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