CPAN112_CompoundInterest_Tyler_Escobar

Fundamentals of Numeric Computing CPAN 112 Compound Interest Program and Assignment Please read the following instruction very carefully before answering any questions:  Please read all the questions very carefully.  Please provide your answers in the boxes below each question, and do not change the text colour.  Your answer MUST show the solution procedure. There is no credit if you only state the final answer.  Please highlight your final answer to each question.  Please keep the naming conventions requested in this lab and each question.  Once you complete your lab, rename your word document file to the ( CPAN112_CompoundInterest_FirstName_LastName ). Replace FirstName and LastName with your first name and last name, respectively. It will be a 10% mark deduction if you do not follow the guidelines mentioned above.

1) For a sum of money borrowed at 7.25% compounded bi-weekly for 84 months, state [10 points] a. the nominal annual rate of interest ( j ); b. the number of compounding interest periods per year ( m ); c. the periodic rate of interest ( i ); d. the number of compounding periods in the term ( n ); e. the compounding factor (1 + i ) n ; f. the numerical value of the compounding factor. j = 7.25%/0.0725; the nominal annual rate m = Bi-weekly = twice per month = 2 m = 52 weeks per year, 52/2 = 26 i = number of years in term * number of compounding periods per year i = j/m i = 0.0725/26 n = number of years in term * m n = 84 months = 7 years (7 * 26) FV = PV(1+I) n (1 + i) n = (1 + 0.0725/26) 7 * 26 Numerical Value is 1.65996039 2) You have a line of credit loan with Scotiabank. The initial loan balance was $6000.00. Payments of $2000.00 and $1500.00 were made after five months and ten months, respectively. At the end of one year, you borrowed an additional $3200.00. Eight months later, the line of credit loan was converted into a collateral mortgage loan. What was the amount of the mortgage if the line of credit interest was 6.15% compounded monthly? [20 points] Initial Loan Balance = 6000.00 2000.00 payment after 5 months 1500.00 payment after 10 months Addition 3200.00 loan added

3) Harpreet's parents deposited a lump sum of money into a savings account for him on his tenth birthday at an interest rate of 5% compounded semi- annually. Three years later, they opened a new account for him. They deposited $5000 to this new account and transferred over the balance from th e original account. The new account paid interest at 4.95% compounded daily. How much money was originally invested if Harpreet had $15 000.67 in the account on the day he turned 19? [20 points] 1500.67 = PV(1 + i) n I = j/m J = 4.95%/0.0495 M = daily/365 I = 0.0495/365 N = 365 * 6 = 2190 15000.67 = PV(1 + 0.0495/365) 2190 PV = 15000.67/1 + 0.0495/365) 2190 (Finding Value at age 13) PV = 11146.38 11146.38 - 5000 = 6146.38 PV = 6146.38/(1 + i) n 4) On April 15, 2023, a 10-year note dated June 15, 2018, is discounted at 10% compounded quarterly. If the face value of the note is $4000 and interest is 8% compounded quarterly, calculate the compound discount. [20 points] FV = PV(1 + I) n PV = FV/(1 + I) n 4000 = FV I = j/m J = 8% or 0.08 M = quarterly = 4 I = 0.08/4 N = 4 x 10 years = 40 PV = 4000/(1 + 0.08/4) 40 PV = 1811.56

Compund Discount = Face Value – Present Value = CD = 4000 – 1811.56 CD = 2188.43 5) Scheduled payments of $1500 due today and $1500 due in three years are to be replaced by two payments. The first payment is due in one year and the second payment, which is double the size of the first payment, is due in five years. Determine the size of each payment if interest is 2.9% compounded weekly. [20 points] PV = FV/(1 + I) n FV = 1500 I = j/m J = 2.9% or 0.029 M = weekly = 7, 52 weeks per year I = 0.029/52 N1 = 0 * 52 = 0 (due today) N2 = 3 * 52 = 156 PV1 = 1500/(1 + 0.029/52) 0 PV1 = 1500 PV2 = 1500/(1 + 0.029/52) 156 PV2 = 1375.05 1500 + 1375.05 = 2875.05 New Future Values NFV + 2(NFV) = 2875.05 3NFV = 2875.05 3x/3 = 2875.05/3 X = 958.35 FV1 = 958.35(1 + 0.029/52) 1*52 FV1 = 958.35(1 + 0.029/52) 52 FV1 = 986.54 FV2 = 2 * 958.35(1 + 0.029/52) 52 * 5

futureValue = round (futureValue) print (futureValue) print ( "Now well check how much it became before the second payment" ) numberOfPeriods = float ( input ( "Lastly, Enter in the New Length of the Period " )) interestRate = interestRate / 100 print ( 'Good Lets do the Equation' ) if typeOfPeriod == "ANNUALLY" : i = interestRate / 1 n = numberOfPeriods * 1 elif typeOfPeriod == "SEMI-ANNUALLY" : i = interestRate / 2 n = numberOfPeriods * 2 elif typeOfPeriod == "QUARTERLY" : i = interestRate / 4 n = numberOfPeriods * 4 elif typeOfPeriod == "MONTHLY" : i = interestRate / 12 n = numberOfPeriods * 12 elif typeOfPeriod == "DAILY" : i = interestRate / 365 n = numberOfPeriods * 365 else : print ( "Sorry but the entered in Period Type doesn't work, try again" ) break firstHalf = ( 1 + i) ** n futureValue = futureValue * firstHalf futureValue = futureValue - 1500 print (futureValue) print ( "Now well check how much it became before the loan" ) numberOfPeriods = float ( input ( "Lastly, Enter in the New Length of the Period " )) interestRate = interestRate / 100 print ( 'Good Lets do the Equation' ) if typeOfPeriod == "ANNUALLY" : i = interestRate / 1 n = numberOfPeriods * 1 elif typeOfPeriod == "SEMI-ANNUALLY" : i = interestRate / 2 n = numberOfPeriods * 2 elif typeOfPeriod == "QUARTERLY" : i = interestRate / 4 n = numberOfPeriods * 4 elif typeOfPeriod == "MONTHLY" : i = interestRate / 12 n = numberOfPeriods * 12 elif typeOfPeriod == "DAILY" : i = interestRate / 365 n = numberOfPeriods * 365

else : print ( "Sorry but the entered in Period Type doesn't work, try again" ) firstHalf = ( 1 + i) ** n futureValue = firstHalf * futureValue futureValue = futureValue + 3200 futureValue = round (futureValue) print (futureValue) print ( "Now well check how much it became after 8 months" ) n = 8 * 12 firstHalf = ( 1 + i) ** n futureValue = firstHalf * futureValue futureValue = round (futureValue) txt = "The Interest Earned over the {0} {1} period is {2%.2f}" print (txt.format(numberOfPeriods, typeOfPeriod, futureValue)) Copy and paste a screenshot of your Python code output here: First, Enter in the Present Value: 6000 Second, Enter in the Interest Rate: 6.15 Before you Enter in the period, whats the time frame (Annually = t,semi- annually = 2, quarterly = 4, monthly = 12, daily = 365): monthly Lastly, Enter in the Length of the Period 5 Good Lets do the Equation 6154 Now well check how much it became before the second payment Lastly, Enter in the New Length of the Period 5 Good Lets do the Equation 4673 Now well check how much it became before the loan Lastly, Enter in the New Length of the Period 2 Good Lets do the Equation 7873 Now well check how much it became after 8 months The Interest Earned over the 2.0 MONTHLY period is 7873 Deliverables :