A newborn baby recieves a 4,000 dollar gift towards a college education from her .Parents How much will the?

4,000 be worth in 10 yrs if it is invested at 4.7% compuond quarterly?

It will be

4000(1 + 0.047/4)^40

since 4000 is the initial amount, 0.047 is the annual interest rate expressed as a fraction, 0.047/4 is the interest per quarter, and there are 40 quarters in 10 years.

= 4000(1.01175)^40

= 4000(1.595616514)

= 6382.466058

= $6382.47 (rounded)

Posted in newborn gifts |

One Response

  1. Robert Says:
    June 16th, 2010 at 12:54 am

    It will be

    4000(1 + 0.047/4)^40

    since 4000 is the initial amount, 0.047 is the annual interest rate expressed as a fraction, 0.047/4 is the interest per quarter, and there are 40 quarters in 10 years.

    = 4000(1.01175)^40

    = 4000(1.595616514)

    = 6382.466058

    = $6382.47 (rounded)
    References :

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