Answer:
The money she will end up earning in interest on the cd = $11,352.90
Step-by-step explanation:
The formula for getting the accumulated amount(compounded) is;
[tex]A =P(1+\frac{r}{n})^n*t[/tex]
Where
A = Accumulated amount
P = principle (deposit)
r = interest rate and
n = no of times interest applied per time period.
The interest is compounded quarterly so in one year it will be 4 times
In 5 years
n = (5×4)-3 = 17 (as she will withdraw 3 month before the completion of five years)
A = [tex]7100(1+\frac{2.8}{100} )[/tex]^17
= 7100( 1 + 0.028)^17
= 7100(1.028)^17
= 7100 * 1.599
= 11,352.90
Therefore the money she will end up earning in interest on the cd = $11,352.90
