# Wing deposit money into account paying 8% annum compunded quartely. 3 yrs later there is $ 1585.30 in account. What was initial amount deposited?

*print*Print*list*Cite

Student Comments

cgrant2 | Student

The formula for annual compound interest quarterly is:

A=P(1+r/4)n

A= annual compound interest

P= principal (initial amount you borrowed)

r= annual rate

n= number of years the amount is borrowed for

We know the following from the equation:

A= 1585.30

P= x

r = 0.08/4

n= 3 years

Solve the equation:

`1585.30= x (1+ 0.08/4)^3`

`1585.30 = 1.60x`

`x = 990.81`

**Therefore intial amount deposited was $990.81**