A bank features a savings account that has an annual percentage rate of r = 5.1% with interest compounded quarterly. Kimberly deposits $12,000 into the account. The account balance can be modeled by the exponential formula A(t) = a(1+ kt where A is account value after t years , a is the principal (starting amount), r is the annual percentage rate, k is the number of times each year that the interest is compounded. (A) What values should be used for a, r, and k? k = (B) How much money will Kimberly have in the account in 10 years? Amount = $ Round answer to the nearest penny. (C) What is the annual percentage yield (APY) for the savings account? (The APY is the actual or effective annual percentage rate which includes all compounding in the year). APY Round answer to 3 decimal places.
A bank features a savings account that has an annual percentage rate of r = 5.1% with interest compounded quarterly. Kimberly deposits $12,000 into the account. The account balance can be modeled by the exponential formula A(t) = a(1+ kt where A is account value after t years , a is the principal (starting amount), r is the annual percentage rate, k is the number of times each year that the interest is compounded. (A) What values should be used for a, r, and k? k = (B) How much money will Kimberly have in the account in 10 years? Amount = $ Round answer to the nearest penny. (C) What is the annual percentage yield (APY) for the savings account? (The APY is the actual or effective annual percentage rate which includes all compounding in the year). APY Round answer to 3 decimal places.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:A bank features a savings account that has an annual percentage rate of r = 5.1% with interest
compounded quarterly. Kimberly deposits $12,000 into the account.
The account balance can be modeled by the exponential formula A(t) = a(1+
r kt
where A is
account value after t years , a is the principal (starting amount), r is the annual percentage rate, k is the
number of times each year that the interest is compounded.
(A) What values should be used for a, r, and k?
k =
= D
(B) How much money will Kimberly have in the account in 10 years?
Amount = $
Round answer to the nearest penny.
(C) What is the annual percentage yield (APY) for the savings account? (The APY is the actual or effective
annual percentage rate which includes all compounding in the year).
АРY
Round answer to 3 decimal places.
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