m r ia = (1 + )" - 1 18 m PART A.) Find the effective annual interest rate for a credit card that lists an APR of 18% compounded monthly. PART B.) An engineer who is saving for a new house plans on saving $100 per paycheck towards the down payment on the house. If she gets paid bi-weekly (twice per month), and s is depositing this money into a savings account that earns 5% annual interest, compounded monthly, how much money does she have saved up after 4 years? Assume that there is no inter-period interest. PART C.) The cost of replacing part of a cell phone video chip production line in 6 years is estimated to be $500,000. At an interest rate of 10% per year, compounded quarterly, the uniform amount that must be deposited every 3 months is?
m r ia = (1 + )" - 1 18 m PART A.) Find the effective annual interest rate for a credit card that lists an APR of 18% compounded monthly. PART B.) An engineer who is saving for a new house plans on saving $100 per paycheck towards the down payment on the house. If she gets paid bi-weekly (twice per month), and s is depositing this money into a savings account that earns 5% annual interest, compounded monthly, how much money does she have saved up after 4 years? Assume that there is no inter-period interest. PART C.) The cost of replacing part of a cell phone video chip production line in 6 years is estimated to be $500,000. At an interest rate of 10% per year, compounded quarterly, the uniform amount that must be deposited every 3 months is?
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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Part c)
Not using excel!
Transcribed Image Text:ia
r m
= (1 + —- )" -
m
- 1
PART A.) Find the effective annual interest rate for a credit card that lists an APR of 18%
compounded monthly.
PART B.) An engineer who is saving for a new house plans on saving $100 per paycheck
towards the down payment on the house. If she gets paid bi-weekly (twice per month), and she
depositing this money into a savings account that earns 5% annual interest, compounded
monthly, how much money does she have saved up after 4 years? Assume that there is no
inter-period interest.
PART C.) The cost of replacing part of a cell phone video chip production line in 6 years
estimated to be $500,000. At an interest rate of 10% per year, compounded quarterly, the
uniform amount that must be deposited every 3 months is?
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