$10,000 is invested for 3 months at an annual simple interest rate of 3%. (a) How much interest will be earned? $ (b) What is the future value of the investment after 3 months? $

Algebra and Trigonometry (MindTap Course List)
4th Edition
ISBN:9781305071742
Author:James Stewart, Lothar Redlin, Saleem Watson
Publisher:James Stewart, Lothar Redlin, Saleem Watson
Chapter13: Sequences And Series
Section13.4: Mathematics Of Finance
Problem 21E
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$10,000 is invested for 3 months at an annual simple interest rate of 3%.
(a) How much interest will be earned?
$
(b) What is the future value of the investment after 3 months?
$
Transcribed Image Text:$10,000 is invested for 3 months at an annual simple interest rate of 3%. (a) How much interest will be earned? $ (b) What is the future value of the investment after 3 months? $
(a) To buy a Treasury bill (T-bill) that matures to $10,000 in 6 months, you must pay $9800. What annual simple interest rate does this earn? (Round your answer to one decimal place.)
%
(b) If the bank charges a fee of $80 to buy a T-bill, what is the actual interest rate you earn? (Round your answer to one decimal place.)
%
Transcribed Image Text:(a) To buy a Treasury bill (T-bill) that matures to $10,000 in 6 months, you must pay $9800. What annual simple interest rate does this earn? (Round your answer to one decimal place.) % (b) If the bank charges a fee of $80 to buy a T-bill, what is the actual interest rate you earn? (Round your answer to one decimal place.) %
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