Question #38cca

1 Answer
Mar 23, 2017

Answer:

#P~~$8848.59# to 2 decimal places

Explanation:

Annual interest is #1.5/100# split this into quarterly then it is #1.5/400# interest for each quarter. As #4xx1.5/400=1.5/100#

Total time span is 15 months. That is 1 year 3 months. So in quarters this is the same time span as 5 quarterly cycles

Let the initial sum (principle sum) be #P#

Then we have:#" "P(1+1.5/400)^5=$9015.75#

#P(401.5/400)^5=$9015.75#

#P=$9015.75 -:(401.4/400)^5 #

#P=$9015.75 xx(400/401.4)^5 ~~$8848.5899... #

#P~~$8848.59# to 2 decimal places