Answer:
the interest rate is $183.89 =~ $ 184
Step-by-step explanation:
In this question, Antuan deposited $2590 into a 3 year CD (Certificate of Deposit) at an interest rate of 2.3% compounded quarterly. We need to find the interest account earned after 3 years.
Formula used will be :
[tex] Interest = P ( 1 + r/n) ^ n ^ t - P[/tex]
Where
P= Principal amount
r= interest rate (in decimals)
n= no of times the interest is compounded
t = no of years
Here we are subtracting P because we only need interest amount and not the future value.
Using this formula and finding the value will be:
P= $2590
r = 2.3 % or 0.023
n = 4
t = 3
[tex]Interest = 2590 * ( 1 - 0.023 / 4) ^ 4^ * ^ 3 - 2590[/tex]
[tex]Interest= 2590 (1.071) -2590\\Interest= 2773.89 - 2590\\Interest= 183.89[/tex]
So the interest rate is $183.89 =~ $ 184
