Question 2 Not yet answered Points out of 10.00 p Flag question Use Table \( 12-1 \) of your text to find the future value of \( \$ 1,300 \) deposited at the BEGINNING of every three months, for 3 years if the bank pays \( 12 \% \) interest, compounded quarterly. Select one: a. \( \$ 18,789.65 \) b. \( \$ 19,955.20 \) c. \( \$ 19,003.13 \) o. d. \( \$ 20,830.22 \)
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If you’re depositing money at the beginning of each period, you’re taking advantage of future value with an annuity due. To find the future value of your quarterly deposits, you can use the formula: FV = P * \[\frac{(1 + r)^n - 1}{r}\] * (1 + r). Here, P is the payment per period, r is the interest rate per period (in this case 3% or 0.03), and n is the total number of periods (12 quarters for 3 years). You're looking for the total of all your future value deposits, which, when calculated correctly, gives you the answer corresponding to option (b): \( \$ 19,955.20 \). So, happy calculating!