BuyFindarrow_forward

Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
ISBN: 9781305585447

Solutions

Chapter
Section
BuyFindarrow_forward

Contemporary Mathematics for Busin...

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

Manually calculate the compound amount and compound interest for the following investments.

Principal Time Nominal Interest Compound Compound

Period (years) Rate (%) Compounded Amount Interest

______________________________________________________________________________

$4,000 2 10 annually $4,840.00 $840.00

________ _______

To determine

To calculate: The compound amount and the compound interest for given investments with principal $4,000 is made for 2 years at 10% compounded annually.

Explanation

Given information:

An investment with principal $4,000 is made for 2 years at 10% compounded annually.

Formula used:

Compounding period can be defined as the duration or length of time from one interest payment to the next. 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:

A=P×(1+i)n

Here, P is the principal, i is the rate per period and n is the compounding period.

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

Compound interest=Compound amountPrincipal

Calculation:

Consider the investment with principal $4,000 made for 2 years at 10% compounded annually and solve as shown below:

Since, the variables- principal, time period (years), nominal rate and interest compounded are given; therefore, the compounding period can be calculated as below:

Compounding periods(n)=Term of investments(years)×m=2×1(In annual compounding,m=1)=2

Calculate the interest rate per period as below:

Interest rate per period=Nominal r

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

Chapter 11 Solutions

Show all chapter solutions add
Sect-11.I P-6RESect-11.I P-7RESect-11.I P-8RESect-11.I P-9RESect-11.I P-10RESect-11.I P-11RESect-11.I P-12RESect-11.I P-13RESect-11.I P-14RESect-11.I P-15RESect-11.I P-16RESect-11.I P-17RESect-11.I P-18RESect-11.I P-19RESect-11.I P-20RESect-11.I P-21RESect-11.I P-22RESect-11.I P-23RESect-11.I P-24RESect-11.I P-25RESect-11.I P-26RESect-11.I P-27RESect-11.I P-28RESect-11.I P-29RESect-11.I P-30RESect-11.I P-31RESect-11.I P-32RESect-11.I P-33RESect-11.I P-34RESect-11.I P-35RESect-11.I P-36RESect-11.I P-37RESect-11.I P-38RESect-11.I P-39RESect-11.I P-40RESect-11.II P-6TIESect-11.II P-7TIESect-11.II P-8TIESect-11.II P-1RESect-11.II P-2RESect-11.II P-3RESect-11.II P-4RESect-11.II P-5RESect-11.II P-6RESect-11.II P-7RESect-11.II P-8RESect-11.II P-9RESect-11.II P-10RESect-11.II P-11RESect-11.II P-12RESect-11.II P-13RESect-11.II P-14RESect-11.II P-15RESect-11.II P-16RESect-11.II P-17RESect-11.II P-18RESect-11.II P-19RESect-11.II P-20RESect-11.II P-21RESect-11.II P-22RESect-11.II P-23RESect-11.II P-24RESect-11.II P-25RESect-11.II P-26RESect-11.II P-27RESect-11.II P-28RESect-11.II P-29RECh-11 P-1CRCh-11 P-2CRCh-11 P-3CRCh-11 P-4CRCh-11 P-5CRCh-11 P-6CRCh-11 P-7CRCh-11 P-8CRCh-11 P-9CRCh-11 P-10CRCh-11 P-11CRCh-11 P-12CRCh-11 P-13CRCh-11 P-14CRCh-11 P-1ATCh-11 P-2ATCh-11 P-3ATCh-11 P-4ATCh-11 P-5ATCh-11 P-6ATCh-11 P-7ATCh-11 P-8ATCh-11 P-9ATCh-11 P-10ATCh-11 P-11ATCh-11 P-12ATCh-11 P-13ATCh-11 P-14ATCh-11 P-15ATCh-11 P-16ATCh-11 P-17ATCh-11 P-18ATCh-11 P-19ATCh-11 P-20ATCh-11 P-21ATCh-11 P-22ATCh-11 P-23ATCh-11 P-24ATCh-11 P-25ATCh-11 P-26ATCh-11 P-27ATCh-11 P-28ATCh-11 P-29ATCh-11 P-30ATCh-11 P-31ATCh-11 P-32ATCh-11 P-33ATCh-11 P-34ATCh-11 P-35ATCh-11 P-36ATCh-11 P-37ATCh-11 P-38ATCh-11 P-39AT

Additional Math Solutions

Find more solutions based on key concepts

Show solutions add

916 Sketch the polar curve. r=322cos

Calculus (MindTap Course List)

In Exercises 5-8, plot the graph of the function f in an appropriate viewing window. (Note: The answer is not u...

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

Name each polygon:

Elementary Technical Mathematics

Evaluate the integral. 15. 0ax2a2x2dx

Single Variable Calculus: Early Transcendentals

Simplified, log3 9x3 is: 2 + 3 log3 x 6 log3 x 9 log3 x 9 + log3 x

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

Describe why you might be cautious about using the Internet to find answers to medical questions.

Research Methods for the Behavioral Sciences (MindTap Course List)

Describe the characteristics of a within-subjects experimental research design.

Research Methods for the Behavioral Sciences (MindTap Course List)