Answer:
$6407.73
Step-by-step explanation:
Use the compound amount formula: A = P(1 + r/n)^(n*t), where
P is the original amount (the principal), r is the interest rate as a decimal fraction, n is the number of times the interest is compounded per year, and t is the number of years.
In this case, P = $5000, r = 0.0625, n = 4 and t = 4. Thus,
A = $5000(1 + 0.0625/4)^(4*4), or
A = $5000(1.015625)^16 = $5000(1.2815) = $6407.73 (to the nearest cent)
