Mark Welsch deposits $8,000 in an account that earns interest at an annual rate of 8%, compounded quarterly. The $8,000 plus earned interest must remain in the account 4 years before it can be withdrawn. How much money will be in the account at the end of 4 years?

Question

Business

Myla

16 February, 11:31

Mark Welsch deposits $8,000 in an account that earns interest at an annual rate of 8%, compounded quarterly. The $8,000 plus earned interest must remain in the account 4 years before it can be withdrawn. How much money will be in the account at the end of 4 years?

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Answers (1)

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Kyle Guerra · Answer 1

At the end the account will need have at the end of the 4 years $17.664,31

Explanation:

Consider the following formula of real interest compound

8.000 deposits

sum after n years = 8.000 * (1+.08/4) ^ (n*4)

= 8.000 * (1.02) ^40 = $17.664,31