Exercise 5.3.7 A bank account is opened with $1000 at time 1 = 0 years. The account pays interest at an annual rate of 2 percent, compounded continuously; that is, the account accrues interest at a rate of 0.02p(t). Suppose the deposit rate is r(t) = 520 dollars per year from time t = 0 to time t = 2, but then drops to r(t) = 200 dollars per year for time /> 2. Formulate an appropriate ODE with an initial condition, and solve using the Laplace transform. Plot the solution for time 0

Exercise 5.3.7 A bank account is opened with $1000 at time 1 = 0 years. The account pays interest at an annual rate of 2 percent, compounded continuously; that is, the account accrues interest at a rate of 0.02p(t). Suppose the deposit rate is r(t) = 520 dollars per year from time t = 0 to time t = 2, but then drops to r(t) = 200 dollars per year for time /> 2. Formulate an appropriate ODE with an initial condition, and solve using the Laplace transform. Plot the solution for time 0

Fundamentals of Financial Management (MindTap Course List)

15th Edition

ISBN:9781337395250

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter5: Time Value Of Money

Section: Chapter Questions

Problem 27P: EFFECTIVE VERSUS NOMINAL INTEREST RATES Bank A pays 2% interest compounded annually on deposits,...

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QUESTION 3 You just deposited $3,500 in a bank account that pays a 4.0% nominal interest rate, compounded quarterly. If you also add another $5,000 to the account one year (4 quarters) from now and another $7,500 to the account two years (8 quarters) from now, how much will be in the account three years (12 quarters) from now? a. $19,222.23 Ob. $13,386.91 c. $18,535.72 d. $14,245,04 Oe. $17,162.70
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1. In a bank account that pays interest 8% p.a, what should you deposit now to have a balance of £900 a year from now? £ 数字 Enter an answer correct to 2 decimal places. 2.a) You deposit £300 into a savings account, which pays compound interest at a rate of 7% per annum. How much money do you have after 3 years? £ 数字 Enter an answer correct to 2 decimal places. b) How many years must you wait to double your capital? 数字 Enter an integer. years
QUESTION 3 Suppose you deposit $2.500 in a CD paying 8% interest, compounded every other month. How much will you have in the account after 15 years? Round your answer to the nearest cent. below is an example how to do problem mple 4 A certificate of deposit (CD) is a savings instrument that many banks offer. It usually gives a higher interest rate, but you cannot access your investment for a specified length of ime. Suppose you deposit $3000 in a CD paying 6% interest, compounded monthly. How much will you have in the accbunt after 20 years? In this example, Pa-$3000 1=0.06 -12 the initial deposit 6% annual rate 12 months in 1 year since we're looking for how much well have after 20 N=20 years 0.06 So P 3000 1+ 12 3D%2993061(round your answer to the nearest penny) %3D Let us compare the amount of money earned from compounding against the amount you would carn from simple interest Yars Simple Interest 6% compounded (S15 per month)monthly 0.5% each month 33900 $4800 $5700 $4046 55…
TEST I. PROMLEM SOLVING: A bank offers 0.25% annual simple interest rate for a particular deposit. How much interest will be earned if 1 million pesos is deposited in this savings account for 1 year? 1. Sunnose vour father denosited in vour bank account P10.000 at an annual interest rate of 0.5%
3. You have a bank deposit now worth $5000. How long will it take for your deposit to be worth more than $8000 if: (a) The account pays 5 percent actual (per sub-period) interest every half-year and is compounded every half- year? (b) The account pays 5 percent nominal interest, , compounded semiannually?
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17 a.Use the appropriate formula to determine the periodic deposit. b.How much of the financial goal comes from deposits and how much comes from interest? Periodic Deposit Rate Time Financial Goal $? at the end of each month 7.25% compounded monthly 40 years $1,250,000 See the formulas and check what is the best one to use for this problem. a.The periodic deposit is$________. (Do not round until the final answer. Then round up to the nearest dollar as needed.) b. $_______ of the $1,250,000 comes from deposits and $_________ comes from interest. (Use the answer from part (a) to find these answers. Round to the nearest dollar as needed.)
Can u also answer part 2
Suppose you deposited $41,000 in a bank account that pays 5.75% with daily compounding based on a 360-day year. How much would be in the account after 8 months, assuming each month has 30 days? a. $42,598.28 b. $42,571.67 c. $43,426.30 d. $42,793.66 e. $42,602.05
1.5 Suppose you would like to retire in 15 years. To save for retirement, you deposit an amount A into the bank at the beginning of the next 180 months. After that period, you would like to withdraw $1,000 at the beginning of the following 300 months. Assume a nominal yearly rate of 7.5% compounded monthly. What amount does A have to be?