Carolina Land Trust purchases private land for clean waterway conservation. A benefactor invested $1,000,000 for 15 years and gave the principal and accrued interest of $1,200,000 to the trust. (a) What simple interest rate did the investment earn? (b) Had the interest been compounded annually at that rate, what would have been the value of the gift?
Carolina Land Trust purchases private land for clean waterway conservation. A benefactor invested $1,000,000 for 15 years and gave the principal and accrued interest of $1,200,000 to the trust. (a) What simple interest rate did the investment earn? (b) Had the interest been compounded annually at that rate, what would have been the value of the gift?
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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Carolina Land Trust purchases private land for clean waterway conservation. A benefactor invested $1,000,000 for 15 years and gave the principal and accrued interest of $1,200,000 to the trust.
(a) What simple interest rate did the investment earn?
(b) Had the interest been compounded annually at that rate, what would have been the value of the gift?
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