A bank features a savings account that has an annual percentage rate of r=5.2% with interest compounded quarterly. Marcus deposits $8,500 into the account.

Question

The account balance can be modeled by the exponential formula S(t)=P(1+rn)^nt, where S is the future value, P is the present value, r is the annual percentage rate written as a decimal, n is the number of times each year that the interest is compounded, and t is the time in years.

(A) What values should be used for P, r, and n?

P= ____ , r=____ , n=______

(B) How much money will Marcus have in the account in 7 years?

Answer = $______ .

Round answer to the nearest penny

Answer 1

The formula is incorrect

S(t) = P * (1 + r/n)^(nt)

P=8500

r = 5.2% = 0.052

t = 7

n=4

8500 ( 1 + 0.052/4)^(7*4) =

8500 ( 1+ 0.013)^(28) =

8500 ( 1.013)^28 =

12203.47