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1. Find the nominal rate compounded monthly which is equivalent to 12% compounded quarterly. What is the corresponding effective rate? 2. At age 30 you invest P5,000 into a mutual fund. If the fund averages an 8% annual return, your investment is worth how much at age 55? 3. You are buying your first car and need to borrow P830,650 over 5 years. If interest is 6%, what are your monthly payments? 4. An investment option is available with continuous compounding at 5% interest. If you invest P8,000 now, how much interest income will you earn if you cash out in 3.5 years?

1. Find the nominal rate compounded monthly which is equivalent to 12% compounded quarterly. What is the corresponding effective rate? 2. At age 30 you invest P5,000 into a mutual fund. If the fund averages an 8% annual return, your investment is worth how much at age 55? 3. You are buying your first car and need to borrow P830,650 over 5 years. If interest is 6%, what are your monthly payments? 4. An investment option is available with continuous compounding at 5% interest. If you invest P8,000 now, how much interest income will you earn if you cash out in 3.5 years?

College Algebra
College Algebra
1st Edition
ISBN:9781938168383
Author:Jay Abramson
Publisher:Jay Abramson
Chapter9: Sequences, Probability And Counting Theory
Section9.4: Series And Their Notations
Problem 56SE: To get the best loan rates available, the Riches want to save enough money to place 20% down on a...
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QUESTIONS: 1. Find the nominal rate compounded monthly which is equivalent to 12% compounded quarterly. What is the corresponding effective rate? 2. At age 30 you invest P5,000 into a mutual fund. If the fund averages an 8% annual return, your investment is worth how much at age 55? 3. You are buying your first car and need to borrow P830,650 over 5 years. If interest is 6%, what are your monthly payments? 4. An investment option is available with continuous compounding at 5% interest. If you invest P8,000 now, how much interest income will you earn if you cash out in 3.5 years?
Transcribed Image Text:QUESTIONS: 1. Find the nominal rate compounded monthly which is equivalent to 12% compounded quarterly. What is the corresponding effective rate? 2. At age 30 you invest P5,000 into a mutual fund. If the fund averages an 8% annual return, your investment is worth how much at age 55? 3. You are buying your first car and need to borrow P830,650 over 5 years. If interest is 6%, what are your monthly payments? 4. An investment option is available with continuous compounding at 5% interest. If you invest P8,000 now, how much interest income will you earn if you cash out in 3.5 years?
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