Answer:
The interest earned in 9 months is $25.45284
Step-by-step explanation:
The interest rate given by the bank = 4%
The rate at which the interest is applied = Quarterly
The amount of money deposited = $840
The formula for compound interest is given as follows;
[tex]Compound \ interest = P \times \left [ \left(1 + \dfrac{r}{n} \right )^{t \times n} - 1\right ][/tex]
Where;
P = The principal = $840
r = The rate = 4% = 0.04
n = The number of times the interest is compounded per period = quarterly = 4
t = The time duration in period = 9 months = 3/4 × 1 year
Substituting the values gives the Compound interest C.I. as follows;
[tex]C.I. = 840 \times \left [ \left(1 + \dfrac{0.04}{4} \right )^{\dfrac{3}{4} \times 3} - 1\right ] = 840 \times \left [ \left(1 + \dfrac{0.04}{4} \right )^{ 3} - 1\right ] = \$ 25.45284[/tex]
The interest earned in 9 months = $25.45284.
