Madelyn opened a savings account and deposited 2,000.00 as principal. The account earns 3% interest, compounded quarterly. What is the balance after 5 years?

Solution

Madelyn opened a savings account and deposited 2, 000.00 as principal. The account earns 3% interest, compounded quarterly. What is the balance after 5 years?

Solution

Amount : 2322.37

Solution steps

Translate the problem into an equation:

A = 2000 (1 + \frac{0.03}{4})^{4 \cdot 5}

2000 (1 + \frac{0.03}{4})^{4 \cdot 5} = 2322.36828 \dots

Round to the nearest hundredth:

2322.37

Amount : 2322.37

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