Answered: a. How much money will you have saved…

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Finance

a. How much money will you have saved after 2 years? b. How much will be owed after 2 years?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 1P

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Question

Calculate compound interest and effective rate
Suppose $ 2,000 is deposited into a savings and loan account that pays 7.5% interest compounded semi-annually. Use compound interest to calculate the following:
a. How much money will you have saved after 2 years?
b. How much will be owed after 2 years?

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