Maybe one more question from me today

Guest has got a valid point Rarinstraw.    

If you are not sure how about you tell us what you think each letter should be and what the answer would therefor be for (a) and we will tell you if it is correct.  ??

As the problem gives you a detailed equation where values should be inputted into the equation. Why ask us when you seem more than capable of doing this equation. However, if you do insist on help...I will gladly help.

(a - )      A=P[1 +r/n]^(nt)

A =5,000 x [1 + 0.05/4]^(5*4)

A =5,000 x [1.0125]^20

A =5,000 x 1.282037

A = $6,410.19

b- Use the same formula as above:

10,000 =5,000 x 1.0125^n, where n = number of quarters. Divide both sides by 5,000

2 = 1.0125^n take the log of both sides

n = Log(2) / Log(1.0125)

n =~56 quarters

56/4 =~14 years

c- Use the same formula as above:

A =5,000 x [1 + 0.05/12]^(5*12), calculate the as as in "a" above:

A =$6,416.79

$6,416.79 - $6,410.19 =$6.60 the difference between comp. monthly and comp. quarterly.