Gordon invested $28,000 into a CD compounded quarterly with an annual interest
rate of 2.50%. Determine how much money Gordon would have after 8 years. Round
your answer to the nearest cent. Provide only a numerical answer (For example, if the
final amount came to $5,023.97, then you would input 5023.97).

Given that Gordon invested $ 28,000 into a CD compounded quarterly with an annual interest rate of 2.50%, to determine how much money Gordon would have after 8 years, the following calculation must be performed:

28,000 x (1 + 0.025 / 4) ^ 8x4 = X

28,000 x (1 + 0.00625) ^ 32 = X

28,000 x 1.00625 ^ 32 = X

28,000 x 1,220 = X

34,177.997 = X

Therefore, Gordon will have $ 34,178 after 8 years of investment.

abidemiokin abidemiokin · Answer 2 · 2021-12-02T11:46:32+01:00

Gordon will have 3,417,799 cents in his account after 8 years

The formula for calculating the compounding amount is expressed as;

[tex]A =P(1+\frac{r}{n} )^{nt}[/tex] where:

P is the amount invested

r is the rate in decimal

t is the time taken

n is the compounding time

Given the following

P = $28,000

r = 2.50% = 0.025

t = 8 years

n = 4

Substitute the given parameters into the formula to have;

[tex]A =28,000(1+\frac{0.025}{4} )^{4(8)}\\A=28,000(1+0.00625)^{32}\\A=28,000(1.00625)^{32}\\A=28,000(1.2206)\\A=$34,177.99[/tex]

Hence Gordon will have 3,417,799 cents in his account after 8 years

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