To solve this problem, we will use the formula for compound interest, which is:

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

Where:
- A is the amount of money accumulated after n years, including interest.
- P is the principal amount (the initial amount of money).
- r is the annual interest rate (in decimal).
- n is the number of times that interest is compounded per year.
- t is the time the money is invested for in years.

Given in the problem:
P = $2000
r = 17.5% = 0.175 (in decimal)
n = 4 (since the interest is compounded quarterly)
t = 8 years

Substitute these values into the formula:

A = 2000 (1 + 0.175/4)^(4*8)

Now, calculate the expression inside the parentheses:

A = 2000 (1 + 0.04375)^(32)

A = 2000 (1.04375)^(32)

Now, raise 1.04375 to the power of 32:

A = 2000 * 3.37948

Finally, multiply 2000 by 3.37948 to find the total amount owed after 8 years:

A = $6758.96

So, the amount owed after 8 years would be approximately $6758.96.

Question

To solve this problem, we will use the formula for compound interest, which is:

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

Where:
- A is the amount of money accumulated after n years, including interest.
- P is the principal amount (the initial amount of money).
- r is the annual interest rate (in decimal).
- n is the number of times that interest is compounded per year.
- t is the time the money is invested for in years.

Given in the problem:
P = $2000
r = 17.5% = 0.175 (in decimal)
n = 4 (since the interest is compounded quarterly)
t = 8 years

Substitute these values into the formula:

A = 2000 (1 + 0.175/4)^(4*8)

Now, calculate the expression inside the parentheses:

A = 2000 (1 + 0.04375)^(32)

A = 2000 (1.04375)^(32)

Now, raise 1.04375 to the power of 32:

A = 2000 * 3.37948

Finally, multiply 2000 by 3.37948 to find the total amount owed after 8 years:

A = $6758.96

So, the amount owed after 8 years would be approximately $6758.96.

Knowee AI · Accepted Answer