Chapter 11.I, Problem 29RE

### Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
ISBN: 9781305585447

Chapter
Section

### Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
ISBN: 9781305585447
Textbook Problem

# Solve the following word problems by using Table 11-1.Sherry Smith invested $3,000 at the Horizon Bank at 6 % interest compounded quarterly.a. What is the annual percentage yield of this investment?b. What will Sherry’s investment be worth after 6 years? (a) To determine To calculate: The annual percentage yield from the investment, if an investment with principal$3,000 is made at 6% compounded quarterly.

Explanation

Given information:

An investment with principal $3,000 is made at 6% compounded quarterly. Formula used: If an investment made for 4 years at 6% compounded annually (once per year) then it would have four compounding period which can be calculated by formula given below: Compounding periods=Term of investments(years)×m Here, m is the period per year. The interest rate per period can be calculated by dividing the annual, or nominal, rate by the number of periods per year, Interest rate per period=Nominal ratePeriod per year The compound amount (Future value) can be calculated by the formula given below: Compound amount=Table factor×Principal In table 11-1, the table factor is the intersection of the rate-per-period column and the number-of-periods row is the future value of$1 at compound interest.

The compound interest can be calculated by the formula given below:

Compound interest=Compound amountPrincipal

The annual percentage yield (APY) can be calculated by the formula given below:

APY=Total compound interest earned in 1 yearPrincipal

Calculation:

Consider the statement as “An investment with principal $3,000 is made at 6% compounded quart (b) To determine To calculate: The worth of sherry’s investment after 6 years, if an investment with principal$3,000 is made at 6% compounded quarterly.

### Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

#### The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

#### In Problems 5-8, use technology to graph the functions. 6.

Mathematical Applications for the Management, Life, and Social Sciences

#### Evaluate the expression sin Exercises 116. 23

Finite Mathematics and Applied Calculus (MindTap Course List)

#### If f(x) = x2/(l + x), find f"(1).

Single Variable Calculus: Early Transcendentals, Volume I

#### In Exercises 7-28, perform the indicated operations and simplify each expression. 17. 1+1x11x

Applied Calculus for the Managerial, Life, and Social Sciences: A Brief Approach

#### Evaluate the indefinite integral. cos(t/2)dt

Single Variable Calculus: Early Transcendentals

#### True or False: converges.

Study Guide for Stewart's Single Variable Calculus: Early Transcendentals, 8th