Frederick deposited $200 in the bank. The bank paid him interest compounded quarterly at the rate of 5 percent per year.

How much money will he have in his account at the end of 6 months?

$205.03

$205

$10

$5.03

Respuesta :

Ben
A) $205.03



The formula for calculating compounded interest is [tex]x=s(1+\frac{r}{n})^{nt}[/tex], where r is the rate of change (0.05), n is the number of times per year interest is compounded (4), s is the starting amount (200), and t is the number of years (0.5).

Substitute these values in to get [tex]x=200(1+\frac{0.05}{4})^{4*0.5}[/tex]. The fraction can be simplified further to get [tex]x=200(1.0125)^{4*0.5}[/tex].

Now simplify the multiplication in the exponent to get [tex]x=200(1.0125)^{2}[/tex]. Then solve the exponent. [tex]x=200(1.02515625)[/tex]

Finally, multiply. You end up with $205.03125, which can be rounded to $205.03.



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