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I need the balance of $2,500 principal earnings with 4% compounded quarterly, after 4 years the balance is?

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2 Answers

The formula is:
 
A = P(1 + r/n)nt
 
Where:
A = the ending balance
P = the principle or initial balance = $2500
r = annual interest rate expressed as a decimal value = 4% = 0.04
n = number of compoundings per year = quarterly = 4
 
A = ($2500)(1 + 0.04/4)4*4
 
A = ($2500)(1.01)16
 
Can you finish it from here?
The formula for discrete compounding (non-continuous) is given by:
 
A = P*(1+ r/n)n*t,
 
where P:  Principle amount
    r:  rate 
    n:  times per year you compound
    t:  number of years
 
Therefore, plugging in the info from the problem you stated, we have:
 
A = (2500)*(1+.04/4)4*4
   = 2931.45