Question

Gordon invested $43,000 into a CD compounded quarterly with an annual interest rate of 3.05%. Determine...

Gordon invested $43,000 into a CD compounded quarterly with an annual interest rate of 3.05%. Determine how much money Gordon would have after 8 years. Round your answer to the nearest cent. Provide only a numerical answer (For example, if the final amount came to $5,023.97, then you would input 5023.97).

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Answer #1

Information provided:

Present value= $43,000

Time= 8 years*4= 32 quarters

Quarterly interest rate= 3.05%/4= 0.7625%

The question is calculated by computing the future value.

Enter the below in a financial calculator to compute the future value:

PV= -43,000

I/Y= 0.7625

N= 32

Press the CPT key and PV to compute the future value.

The value obtained is 54,832.03.

Therefore, Gordon will have 54,832.03 in 8 years.

In case of any query, kindly comment on the solution.

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