Compound Interest

Question

yujin Pon has a principal of $900 in her savings account on october 1. The money earns interest at a rate of 6.5% compounded quarterly. what is the amount in the account after 6 years?

Answer 1

Future Value = Co * (1+rate)^periods

 

FV = 900 * (1+.065/4)^24

 

FV = 900 * 1.01625^24

 

FV = 900 * 1.472

 

FV = $1324.80

 

This is assuming that the 6.5% is APR, which is why it is divided by 4