Thread: One Question on interest.

Mary invests $10,000 at 4.5% interest a year, compounded quarterly.

(A)How much will she have after 20 years?

(B) If the interest were compound semi-monthly, how much more would Mary have after 20 years than compounded quarterly?

Equation


A=P[1+r/k]^kt


I got 24,472 after 20 years

But I dont know how to do the second part (B)

Originally Posted by WallStreet

Mary invests $10,000 at 4.5% interest a year, compounded quarterly.

(A)How much will she have after 20 years?

(B) If the interest were compound semi-monthly, how much more would Mary have after 20 years than compounded quarterly?

Equation


A=P[1+r/k]^kt


I got 24,472 after 20 years

But I dont know how to do the second part (B)

24 semi-monthly periods in a year ...

thanks. Did i do part A correctly?

close enough ... I got 24472.75