Answer: [tex]A = 500(1.0125)^{100}[/tex]
Step-by-step explanation:
Compound interest
A = P(1 + r/n)^nt
A is the final amount (what we are solving for)
P is the initial principal balance (P=500)
r is the interest rate as a decimal (r=0.05)
t is the time (25 years)
n is the number of times it is compounded yearly (every three months so n=4)
A = 500(1 + 0.05/4)^4(25)
A = 500(1 + 0.0125)^4(25)
A = 500(1.0125)^4(25)
A = 500(1.0125)^100
