a. Determine the interest rate if the money was compounded continuously. b. Determine the effective interest rate. c. Determine the Present Worth Factor.
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- For the following exercise, use the compound interest formula, A(t) = P 1 + r n nt , where money is measured in dollars.After a certain number of years, the value of an investment account is represented by the expression 10,950 1 + 0.03 2 24 . How many years had the account been accumulating interest? yrFor a sum of money invested at 11.5% compounded for 5 years state the following values. i) The number of compounding periods is =? ii) The periodic rate of interest is = %? iii) The compounding factor is (1+?)? iv) The numerical value of the compounding factor is =?The equation, A = P(1 + 0.037t), represents the amount of money earned on a savings account with 3.7% annual simple interest. If the amount after 5 years is equal to $1,422, what is the amount of the principal investment? $1,200 $1,422 $274.25 $294.86
- 4. What rate of interest, compounded annually, willresult in the receipt of $15938.48 if $10000 is investedfor 8 years?include a cash flowWhen interest is compounded continuously, the amount of money increases at a rate proportional to the amount S present at time t, that is, dS/dt = rS, where r is the annual rate of interest. (a) Find the amount of money accrued at the end of 3 years when $6000 is deposited in a savings account drawing 5 3 4 % annual interest compounded continuously. (Round your answer to the nearest cent.) b) in how many years will the initial sum deposited have doubled?(round to the nearest year) c) use a calculator to compare the amount obtained in part (a) with the amount s=(1 + 1/4(0.0575))^3(4) that is accrued when interest is compounded quarterly. (round your answer to the nearest cent.)3. Calculate the total present value of the following three cash flows: $98 obtained one year from today, $28 obtained two years from today, and $26 obtained three years from today. Use 10.2% as the interest rate. Answer to the nearest cent
- Suppose you invest $103 nin a bank account, and five years later it has grown to $137.91. a. What APR did you receive, if the interest was compounded semiannually? b. What APR did you receive if the interest was compounded monthly?Determine what the interest rate would have been if a financial asset valued at $156,500 amounted to a total value of $199,800 after 2 years.A certain some of money P draws interest compounded continuously. If a certain time there are Po dollars in the account, determine the time when the financial attains the value of 2Po dollars if the annual interest rate at 2%
- Suppose you invest $1,250 in an account paying 8% interest per year. a. What is the balance in the account after 3years? How much of this balance corresponds to "interest on interest"? b. What is the balance in the account after 31 years? How much of this balance corresponds to "interest on interest"?Compute the following with the data provided: (Show sufficient work with formulas used and all the steps involved ) A=$12, 500.00 per Quarter r=7.5% N=12 years Present Worth if the interest is compounded monthly? Future Value if the interest is compounded Quarterly: Present Worth if the interest is compounded continuously?For each of the following situations involving single amounts, solve for the unknown (?). Assume that interest is compounded annually. (i = interest rate, and n = number of years) Present Value Future Value i n1. ? $ 40,000 10% 52. $ 36,289 65,000 ? 103. 15,884 40,000 8 ?4. 46,651 100,000 ? 85. 15,376 ? 7 20