Explanation Given: The amount invested is $75,000 at the rate of 0.90% compounded quarterly for four years. Formula used: The expression of the interest rate per period is; i = r m Here, i is the interest rate per time period, r is the interest rate and m is the number of time periods per year or month. The formula for compound amount or future value is defined as, F V = P V ( 1 + i ) n Here, PV is the amount invested, i is the interest rate per period and n is the number of compounding periods. The formula for interest earned is defined as; Amount of interest = Compound amount − Initial deposit Calculation: For quarterly, the number of months in a year is 4 months. m = 4 months Recall the interest rate per period is calculated. i = r m Substitute 0.009 for r and 4 for m . i = 0.009 4 Here, the interest is compounded quarterly. Recall the formula of future value. F V = P V ( 1 + i ) n Substitute 0

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Chapter 5.2, Problem 15E

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To calculate: The compound amount and the interest earned for an invested amount of $75,000 at a rate of 0.90% which is compounded quarterly for four years.

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Chapter 5.2, Problem 14E

Chapter 5.2, Problem 16E

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The compound amount and the interest earned for an invested amount of $75,000 at a rate of 0.90% which is compounded quarterly for four years.

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To calculate: The compound amount and the interest earned for an invested amount of $75,000 at a rate of 0.90% which is compounded quarterly for four years.

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