Answer:
[tex]A\simeq3325.91[/tex]
Step-by-step explanation:
The amount formula in compound interest is:
[tex]A=P(1+\frac{r}{n} )^{nt}[/tex]
where:
P = principal amount
r = annual interest
n = number of compounding periods
t = number of years
We already know that:
P = $2500
[tex]r = 5.75\% = \frac{5.75\%}{100\%}=0.0575[/tex]
t = 5
n = 4 (quarterly in a year)
Then,
[tex]A=2500(1+\frac{0.0575}{4} )^{(4)(5)}\\\\A=2500(1+\frac{0.0575}{4} )^{20}\\\\A=3325.911985\\\\A\simeq3325.91[/tex]
