A bank features a savings account that has an annual percentage rate of 2.2 % with interest compounded quarterly. Alo deposits $3,000 into the account.

How much money will Alo have in the account in 1 year?

To calculate the amount Alo will have in the account after 1 year with interest compounded quarterly, we use the compound interest formula:

\[
A = P \left(1 + \frac{r}{n}\right)^{nt}
\]

Where:
- $ A $ = the future value of the investment/loan, including interest.
- $ P $ = the principal amount (initial deposit), which is \$3,000.
- $ r $ = the annual interest rate (decimal), so 2.2% becomes 0.022.
- $ n $ = the number of times interest is compounded per year, which is 4 (quarterly).
- $ t $ = the time the money is invested for in years, which is 1.

### Plugging in the values:
\[
A = 3000 \left(1 + \frac{0.022}{4}\right)^{4 \times 1}
\]

\[
A = 3000 \left(1 + 0.0055\right)^4
\]

\[
A = 3000 \left(1.0055\right)^4
\]

Now we calculate $ (1.0055)^4 $:

\[
(1.0055)^4 \approx 1.0222
\]

So the future value $ A $ becomes:

\[
A = 3000 \times 1.0222 \approx 3066.60
\]

### Final Answer:
Alo will have approximately **\$3,066.60** in the account after 1 year.

Would you like more details or have any questions about this calculation?

Here are 5 related questions to explore further:
1. What would the amount be if the interest were compounded monthly instead?
2. How much interest would Alo earn in 2 years with the same interest rate?
3. What would be the balance after 5 years with the same conditions?
4. How does changing the compounding frequency affect the final amount?
5. How much would Alo need to deposit to have \$4,000 in 1 year with the same rate?

**Tip:** Compounding more frequently results in a slightly higher amount due to interest being calculated on a slightly increased balance each period.

A bank features a savings account that has an annual percentage rate of 2.2 % with interest compounded quarterly. Alo deposits $3,000 into the account. How much money will Alo have in the account in 1 year?

Learn how to calculate the compound interest on a $3,000 savings account with a 2.2% annual interest rate compounded quarterly. Discover the final balance after 1 year using the compound interest formula A = P(1 + r/n)^(nt). Perfect for high school students (Grades 10-12) studying finance and exponential growth.

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