n your answer, describe whether you used formula 1, formula 2, formula 3, or formula 4. Show supporting work, round your answer to the nearest cent, and include units with your answer. (a) If you want an account balance of $10,000 after 5 years, what amount do you need to invest initially into an account that earns an APR of 3% with quarterly compounding? b) If you invest $10,000 in an account that earns an APR of 5% with monthly compounding, what will be the account balance after 10 years?

n your answer, describe whether you used formula 1, formula 2, formula 3, or formula 4. Show supporting work, round your answer to the nearest cent, and include units with your answer. (a) If you want an account balance of $10,000 after 5 years, what amount do you need to invest initially into an account that earns an APR of 3% with quarterly compounding? b) If you invest $10,000 in an account that earns an APR of 5% with monthly compounding, what will be the account balance after 10 years?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter22: Inflation

Section: Chapter Questions

Problem 7SCQ: Go to this website (http://www.measuringworth.com/ppowerus/) for the Purchasing Power Calculator at...

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Question

For the following problems, choose from these formulas:
Formula 1
A = P +Prt
Formula 3
A = P(1 + APR)"
P =
Formula 2
P
A
1+rt
Formula 4
A
APR (ny)
n
(1 +³
In your answer, describe whether you used formula 1, formula 2, formula 3, or formula 4. Show supporting
work, round your answer to the nearest cent, and include units with your answer.
(a) If you want an account balance of $10,000 after 5 years, what amount do you need to invest initially into
an account that earns an APR of 3% with quarterly compounding?
(b) If you invest $10,000 in an account that earns an APR of 5% with monthly compounding, what will be the
account balance after 10 years?
(c) If you invest $10,000 in an account that earns an APR of 5% simple interest, what will be the account
balance after 10 years?

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