ECONOMICS
COMPOUND INTEREST
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Determine the balance in the account if you deposited $4, 000 at an interest rate of 3.4% compounded quarterly for three years.

$4422.03


$4427.62


$4428.90


$4429.51

Explanation:
Detailed explanation1: Detailed Solution ∴ Compound interest is Rs. 410.
Detailed explanation2: Rs 4505.96 money will be in the account after 2 years . Where P is the principle value, r is the rate in the decimal form and n is the time in years. 6% is written in the decimal form . Therefore Rs 4505.96 money will be in the account after 2 years .
Detailed explanation3: So, the correct answer is “410 Rs.”.
Detailed explanation4: Simple Interest Formula Thus, if simple interest is charged at 5% on a $10, 000 loan that is taken out for three years, then the total amount of interest payable by the borrower is calculated as $10, 000 x 0.05 x 3 = $1, 500.
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