A = P(1+[r/n])^(nt)
P = initial deposit ($10,000)
r = interest rate (0.04)
t = number of years the deposit is held in the account (18)
n = the number of times the interest is compounded per year ('quarterly' means 4 times per year so n = 4)
A = $10,000(1+0.04/4)^(4*18)
A = $10,000(1.01)^72
A = $10,000(2.047199)
A = $20,471.99
As a savings plan for college, when their son Bill was born, the Johnson's deposited $10,000 in an account paying 4% compounded quarterly. How much is in this account when Bill is 18 years old?
Thanks!
