Respuesta :
Answer:
You will earn $483.55 in interest.
Step-by-step explanation:
The compound interest formula is given by:
[tex]A(t) = P(1 + \frac{r}{n})^{nt}[/tex]
Where A(t) is the amount of money after t years, P is the principal(the initial sum of money), r is the interest rate(as a decimal value), n is the number of times that interest is compounded per year and t is the time in years for which the money is invested or borrowed.
$3,000 T - note with a 3% annual rate
This means that [tex]P = 3000, r = 0.03[/tex]
Paid quarterly
Quarterly is 4 times per year, so [tex]n = 4[/tex]
Maturity in 5 years.
This means that [tex]t = 5[/tex]
How much interest will you earn?
Interest is the final amount subtracted by the principal.
Final amount:
A(5).
[tex]A(t) = P(1 + \frac{r}{n})^{nt}[/tex]
[tex]A(5) = 3000(1 + \frac{0.03}{4})^{4*5}[/tex]
[tex]A(5) = 3483.55[/tex]
Interest:
$3,483.55 - $3,000 = $483.55
You will earn $483.55 in interest.
