Dana's mother gave her $175 on her sixteenth birthday. “But you must put it in the bank and leave it there until your eighteenth birthday,” she told Dana. Dana already had $237.54 in her account, which pays 3.25% annual interest, compounded quarterly. What is the minimum amount of money she will have on her eighteenth birthday if she makes no withdrawals before then? Justify your answer. Homework Help ✎
Notice that the interest is 3.25% annually, but it is compounded quarterly.
This means that you need to divide the percentage by 4, and multiply the number of compoundings by 4.