Principal, P= 500
interest = 4%/4 = 0.01 (per quarter)
Number of periods, n = 6*4 =24 quarters
Compound interest formula:
Future value:
[tex]F=P(1+i)^n[/tex]
[tex]=500(1+0.01)^{24}[/tex]
[tex]=500(1+0.01)^{24}[/tex]
[tex]=634.87[/tex] to the nearest cent.
In my books, this is the easiest way. If you have a different way, or if there are questions, please do not hesitate to let me know.
