Financial Accounting Three years ago, you invested $2,450.00. Today, itis worth $3,250.00. What rate of interest did youearn?a. 4.06 percent.b. 4.94 percent.c. 9.88 percent.d. 0.82 percent.e. 3.06 percent.

Step 1: Define Time ValueThe time value of an amount arises because of the alternative uses of an…

Answered: Three years ago, you invested…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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You made an investment of $8,500 into an account that paid you an annual interest rate of 4.2 percent for the first 8 years and 8.6 percent for the next 14 years. What was your annual rate of return over the entire 22 years?Multiple Choice6.40 % 7.75 % 6.28 % 6.98 % 5.58%
10. Which of the following 1-year investments has the highest rate of return? (a) $12,500 that yields $1125 in interest, (b) $56,000 that yields $6160 in interest, or (c) $95,000 that yields $7600 in interest.
Suppose you invest $1,500 in an account paying 6% interest per year. How much of this balance corresponds to interest on interest earned in the last (7th) period? (Dollar figures should be approximated to the nearest cent of a dollar, while rates should be expressed in percentage terms without using the "%" symbol and approximated to the nearest second decimal place.)
Consider the followingalternatives: i. $120 received in one year ii. $220 received in five years iii. $350 received in 10 years a. Rank the alternatives from most valuable to least valuable if the interest rate is 7% per year. b. What is your ranking if the interest rate isonly 2% per year? c. What is your ranking if the interest rate is 14% per year?
You invested 7,667.40 into an account that pays 9.15% interest. How much money will you have in 40 years? 254,447 160,582 182,664 318,656 201,427
(Compound interest) To what amount will the following investments accumulate? a. $4,900 invested for 9 years at 10 percent compounded annually. b. $8,100 invested for 6 years at 9 percent compounded annually. c. $750 invested for 11 years at 13 percent compounded annually. d. $21,000 invested for 5 years at 4 percent compounded annually. a. To what amount will $4,900 invested for 9 years at 10 percent compounded annually accumulate? $nothing (Round to the nearest cent.)
Please answer the question posted in the image below:
Assume that at the beginning of the year, you purchase an investment for $6,500 that pays $95 annual income. Also assume the investment's value has increased to $7,050 by the end of the year. a. What is the rate of return for this investment? Note: Input the amount as a positive value. Enter your answer as a percent rounded to 2 decimal places.
Am. 410.
You made an investment of $8,000 into an account that paid you an annual interest rate of 3.1 percent for the first 5 years and 7.5 percent for the next 10 years. What was your annual rate of return over the entire 15 years? Multiple Choice 4.81 % 6.68 % 5.30 % 6.01 % 5.41 %
Suppose you invest $1,250 in an account paying 8% interest per year. a. What is the balance in the account after 3years? How much of this balance corresponds to "interest on interest"? b. What is the balance in the account after 31 years? How much of this balance corresponds to "interest on interest"?
For the following exercise, use the compound interest formula, A(t) = P 1 + r n nt , where money is measured in dollars.After a certain number of years, the value of an investment account is represented by the expression 10,950 1 + 0.03 2 24 . How many years had the account been accumulating interest? yr

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Three years ago, you invested $2,450.00. Today, it is worth $3,250.00. What rate of interest did you earn? a. 4.06 percent. b. 4.94 percent. c. 9.88 percent. d. 0.82 percent. e. 3.06 percent.