Answer:
The correct option is D. $3.75
Step-by-step explanation:
Principal Value, P = $500
Rate of interest, r = 3%
= 0.03
Time, t = 3 months
\(\implies Time = \frac{3}{12}=\frac{1}{4}\text{ years}\)
n = number of times the interest is compounded
⇒ n = 4
\(Amount = P\cdot (1+\frac{r}{n})^{n\times t}\\\\\implies Amount=500\cdot (1+\frac{0.03}{4})^{4\times \frac{1}{4}}\\\\\implies Amount = \$503.75\)
Now, Withdrawal fee = Amount paid - Principal value
⇒ Withdrawal fee = 503.75 - 500
⇒ Withdrawal fee = $3.75
Hence, The correct option is D. $3.75
