Find the time t, in years, for the principal P = $715 to reach the future value F = $740 under r = 1.89% interest compounded quarterly. Round your final answer to two decimal places.
Find the time t, in years, for the principal P = $715 to reach the future value F = $740 under r = 1.89% interest compounded quarterly. Round your final answer to two 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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Question
Find the time t, in years, for the principal P = $715 to reach the
Expert Solution
Step 1: Time required in years calculation
Principal (P) = $715
Future value(F) =$740
Rate = 1.89% compounded quarterly
So, quarterly compound rate = 0.0189/4 = 0.47%
Let time required to reach the future value = "t"
Quarterly period = 4t
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