Answer:
212.3
Step-by-step explanation:
For this problem we have a CD earning interest every four months. Therefore, supposing that the 3% APR is distributed equally along the year, we have that quarterly the previous amount earns 1%.
Hence, for the first period we have:
p1 = 200(1 + 0.01)
Now, the maturity period is 2 years, then we have 6 periods, therefore:
p2 = p1(1 + 0.01)
p3 = p2(1 + 0.01)
.
.
.
p6 = p5(1 + 0.01)
We can make things easier making the following calculation:
\(200(1+0.1)^{6}\)
According to the above, we may say that the CD will be worth $212.3 at maturity.
