Chapter 11.II, Problem 9RE

BuyFind*arrow_forward*

8th Edition

Robert Brechner + 1 other

ISBN: 9781305585447

Textbook Problem

For the following investments, calculate the present value (principal) and the compound interest. Use Table 11-2. Round your answer to the nearest cent.

To determine

**To calculate:** The present value (principal) and the compound interest for an investment with compound amount

Explanation

**Given information:**

An investment with compound amount

**Formula used:**

Compounding period can be calculated by formula given below:

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,

The present value (principal) can be calculated by the formula given below:

In Present value table 11-2, the table factor is the intersection of the rate-per-period column and the number-of-periods row is the present value of

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

**Calculation:**

Consider the compound amount

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

Sect-11.I P-1TIESect-11.I P-2TIESect-11.I P-3TIESect-11.I P-4TIESect-11.I P-5TIESect-11.I P-1RESect-11.I P-2RESect-11.I P-3RESect-11.I P-4RESect-11.I P-5RE

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

Essentials of Statistics for The Behavioral Sciences (MindTap Course List)

Multivariable Calculus

Finite Mathematics and Applied Calculus (MindTap Course List)

Calculus (MindTap Course List)

Precalculus: Mathematics for Calculus (Standalone Book)

Single Variable Calculus

Intermediate Algebra

Applied Calculus

Calculus: An Applied Approach (MindTap Course List)

Understanding Basic Statistics

Probability and Statistics for Engineering and the Sciences

Finite Mathematics

Essentials Of Statistics

Single Variable Calculus: Early Transcendentals, Volume I

Mathematical Applications for the Management, Life, and Social Sciences

Elementary Technical Mathematics

Calculus: Early Transcendentals

Statistics for The Behavioral Sciences (MindTap Course List)

Elementary Geometry For College Students, 7e

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

Calculus: Early Transcendental Functions

Mathematical Excursions (MindTap Course List)

Calculus: Early Transcendental Functions (MindTap Course List)

Calculus of a Single Variable

Single Variable Calculus: Early Transcendentals

Elements Of Modern Algebra

Trigonometry (MindTap Course List)

Finite Mathematics for the Managerial, Life, and Social Sciences

Elementary Geometry for College Students

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

Study Guide for Stewart's Multivariable Calculus, 8th

Introduction To Statistics And Data Analysis

College Algebra (MindTap Course List)

Multivariable Calculus

Statistics for Business & Economics, Revised (MindTap Course List)

Research Methods for the Behavioral Sciences (MindTap Course List)

Research Methods for the Behavioral Sciences (MindTap Course List)

STATISTICS F/BUSINESS+ECONOMICS-TEXT

Calculus (MindTap Course List)

Mathematics For Machine Technology