You deposit $5000 in an account earning 7% interest compounded quarterly. How much will you have in the account in 15 years? Round your answer to the nearest cent.


To determine how much you will have in the account after 15 years, we will use the compound interest formula:

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

Where:
- $ A $ = the amount of money in the account after interest
- $ P $ = the principal amount (\$5000)
- $ r $ = the annual interest rate (7% or 0.07)
- $ n $ = the number of times the interest is compounded per year (quarterly means 4 times a year)
- $ t $ = the time the money is invested for, in years (15 years)

Now, substituting the given values into the formula:

\[
A = 5000 \left(1 + \frac{0.07}{4}\right)^{4 \times 15}
\]

Let me calculate this.After 15 years, you will have approximately **$14,159.08** in the account.

Would you like more details on how this was calculated or have any other questions?

Here are 5 related questions to expand your understanding:
1. How does the frequency of compounding (e.g., monthly or yearly) affect the total amount?
2. What would the final amount be if the interest rate was 5% instead of 7%?
3. How much interest would you earn if the account was compounded annually instead of quarterly?
4. What would happen if you withdrew part of the money before the 15 years were up?
5. How can you calculate the initial deposit needed to reach a certain future value?

**Tip:** Compounding more frequently (e.g., quarterly vs. annually) results in more interest, as the interest is calculated and added more often!

You deposit $5000 in an account earning 7% interest compounded quarterly. How much will you have in the account in 15 years? Round your answer to the nearest cent.

Discover how to calculate the future value of a $5000 deposit earning 7% interest compounded quarterly over 15 years. This problem involves key concepts like compound interest and exponential growth. Learn how to apply the compound interest formula to find that the final amount is approximately $14,159.08. Perfect for students in Grades 9-12.

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