Charlton borrowed 59.000 from his bank. The loan will be compounded quarterly for 55 years at a 7.5% interest rate. Note: Use the formula FV = P (1+)

The full amount to the nearest whole cent) he will owe to the bank (principal + interest) is?

a $13,543.48

b $ 12,876.47

c $14,064.21

d $15,135.09

e none of them are correct

The full amount he will owe to the bank=$3,513.41

Step-by-step explanation:

The formula for the future value of the loan after 55 years, can be written as;

F. V=P. V (1+r/n) ^nt

where;

F. V=future value of the loan

P. V=present value of the loan

r=annual interest rate

n=number of compounding periods per year

t=number of years

In our case;

P. V=59

r=7.5%=7.5/100=0.075

n=4

t=55 years

replacing;

F. V=59 (1+0.075/4) ^ (4*55)

F. V=59 (1.01875) ^220

F. V=3,513.41

The full amount he will owe to the bank=$3,513.41