At the birth of their child, the Fieldsons deposited $4000 in an account paying 7% interest, compounded quarterly.How much will be available when the child turns 14?
A)$10,567.87
B)$10,868.27
C)$5,283.94
D)$10,668.41
E)$10,467.33

Question

Quizplus · Accepted Answer

The correct answer is A because the amount available when the child turns 14 can be calculated using the formula A = P(1 + r/n)^(nt), where P is the principal amount deposited, r is the annual interest rate, n is the number of times per year that the interest is compounded, and t is the number of years. In this case, P = $4000, r = 7%, n = 4 (since the interest is compounded quarterly), and t = 14. Plugging these values into the formula, we get A = 4000(1 + 0.07/4)^(4*14) = $10,567.87.

At the Birth of Their Child, the Fieldsons Deposited $4000