Answer
(a) After 3.5 years, there will be \$1615.73 in the account.
(b) The interest earned is \$415.73
Work Step by Step
(a) We can use this formula:
$A = P~(1+\frac{r}{n})^{nt}$
$A$ is the final amount in the account
$P$ is the principal (the amount of money invested)
$r$ is the interest rate
$n$ is the number of times per year the interest is compounded
$t$ is the number of years
$A = P~(1+\frac{r}{n})^{nt}$
$A = (\$1200)~(1+\frac{0.085}{360})^{(360)(3.5)}$
$A = \$1615.73$
After 3.5 years, there will be \$1615.73 in the account.
(b) We can find the interest earned.
$A - P = \$1615.73 - \$1200 = \$415.73$
The interest earned is \$415.73
