Suppose you buy a cd for $500 that earns 2.5% apr and is compounded quarterly. the cd matures in 3 years. how much will this cd be worth at maturity?

a. $512.62
b. $538.82
c. $512.64
d. $504.18

We're going to use the compounded intrest formula:



Where P is the initial cost
r is the rate as a decimal
n is the amount per year that you invest the rate
t is the amount of time at which you're checking how much it's worth (yrs)

Using this information, we can use:



So your answer will be B.