Suppose you have $5,000 to invest for the next 40 years. You are given 3 choices on where to invest your money. Account #1 12.20% compounded weekly Account #2 12.18% compounded daily 12.16% compounded continuously Account #3 Calculate the APR (assume P-$100, t=1 year) for each account. Round to 2 decimal places, in percent form. APR Account #1 % Account #2 % Account #3 % SHOW WORK BELOW: Based on your calculations, which account will you invest your $5,000? Why? How much money will you have after 40 years in the account that you have chosen? How much in total interest will you gain? In other words, from $5,000, by how much did your money increase?
Suppose you have $5,000 to invest for the next 40 years. You are given 3 choices on where to invest your money. Account #1 12.20% compounded weekly Account #2 12.18% compounded daily 12.16% compounded continuously Account #3 Calculate the APR (assume P-$100, t=1 year) for each account. Round to 2 decimal places, in percent form. APR Account #1 % Account #2 % Account #3 % SHOW WORK BELOW: Based on your calculations, which account will you invest your $5,000? Why? How much money will you have after 40 years in the account that you have chosen? How much in total interest will you gain? In other words, from $5,000, by how much did your money increase?
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 16PROB
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Transcribed Image Text:Suppose you have $5,000 to invest for the next 40 years. You are given 3 choices on where to invest your money.
Account #1
12.20% compounded weekly
Account #2
12.18% compounded daily
12.16% compounded continuously
Account #3
Calculate the APR (assume P-$100, t=1 year) for each account. Round to 2 decimal places, in percent form.
APR
Account #1
%
Account #2
%
Account #3
%
SHOW WORK BELOW:
Based on your calculations, which account will you invest your $5,000? Why? How much money will you have after 40
years in the account that you have chosen? How much in total interest will you gain? In other words, from $5,000, by how
much did your money increase?
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