Investment 1: Investing that $120,000 in a saving account for 15 years. There are two banks for her choice. Bank A pays a rate of return of 8.5% annually, compounding semi-annually. Bank B pays a rate of return of 8.45 annually, compounding quarterly. Investment 2: Putting exactly an equal amount of money into ANZ Investment Fund at the end of each month for 15 years to get 330 000 she still shorts of now. The fund is offering a rate of return 7% per year, compounding monthly.How much is the annual interest rate, assuming compounding annually Holly should aim at if she chooses to invest her $120 000 in a saving account to get the $450,000 ready in just 10 years from now?
Investment 1: Investing that $120,000 in a saving account for 15 years. There are two banks for her choice. Bank A pays a
Given information:
Future value amount (accumulated) is $450,000
Number of years is 10
Present value of investment is $120,000
Calculation of annual interest rate:
Excel workings:
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