College Algebra (10th Edition)

Published by Pearson
ISBN 10: 0321979478
ISBN 13: 978-0-32197-947-6

Chapter 6 - Section 6.7 - Financial Models - 6.7 Assess Your Understanding: 9

Answer

$609.50$

Work Step by Step

We know the following equation: $$A=P(1+ \frac{r}{n})^{nt}$$ Where: P is the principal. A is the amount of interest. r is the rate, expressed as a decimal. t is the time, in years. n is the number of times the interest is compounded per year. Thus, we obtain: $$A=500(1+ \frac{.08}{4})^{4*2.5}\\ A= 609.50$$
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