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compounded quaterly

Step-by-step explanation:

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Let's say:

AM = current amount of money = 3000

APR = interest rate  = 2.25

n = number of compounding periods

t = 5 years

Final amount of money:

FAM = AM x [1 + 2.25/n]^(n x 5) = 3000 x [1 + 2.25/n]^(n x 5)

Annual Compounding: FAM = 3000 x (1 + (2.25% / 1))^(1 x 5) = 3353.03

Quarterly Compounding: FAM = 3000 x (1 + (2.25% / 4))^(4 x 5) = 3356.16

Monthly Compounding: FAM = 3000 x (1 + (2.25% / 12))^(12 x 5) = 3356.86

Continuous Compounding: FAM = 3000 x 2.7183^(2.25% x 5) = 3357.22

=>Continuous Compounding gives largest benefit.

=> Option C is correct

Hope this helps!

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