Answer: $564
Step-by-step explanation:
You invested $500.
The annual rate is 2% and it is compounded quarterly.
You need the account balance after 6 years.
Convert the terms to their correct periodic figures.
Interest = 2%/4 = 0.5% per quarter
Period = 6 * 4 = 24 quarters
Formula for compound interest:
= Investment * ( 1 + rate) ^ time
= 500 * ( 1 + 0.5%)²⁴
= 563.579
= $564
