Determine the amount of interest earned by a single deposit

Determine the amount of interest earned by a single deposit of $ 8, 750 with an annual interest rate 7.25% compounded quarterly for 9 years

Solution

let the principal value = P ,

rate = r .

time = t years

then Future value = P(1+r/100)^t

intersest = Future value - P

=P(1+r/100)^t -P

= P((1+r/100)^t -1)

here

P = 8750 , r = 25 % ,t = 9

hence Interest

= 8750((1+0.25)^9 -1)

=56442.58