We can use the compound interest formula
F=P(1+i)^n
where
F=Future value of investment to be found
P=present value of investment ($1000)
i=interest per period (1/4 year)=0.04/4=0.01
n=number of periods (3 years * 4 quarters = 12)
Substitute or "Plug in" values, so to speak,
F=1000*(1+0.01)^12
use a calculator to do the sum
=1126.83 (to the nearest cent, and use the proper rounding rules)
