You wish to deposit $7000 in an account at the bank. The bank pays interest at a nominal annual rate of 10% compounded quarterly. What is the future value in the account after 7 years?

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Using the compound interest formula, we have thatP = $7000, r = 10/100 = 0.1, n = 4, t = 7. Therefore,

A is deposit value in future

A = P (1+ r/n)^nt

A = 7000(1+ 0.1/4)^(4)(7)

A = 7000 (1.025)^28

A = 7000 (1.996)

A = $13975 approx

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