When $8,600 is invested in a savings account paying simple interest for the year, the interest, i in dollars, canobtained from the equation i=8,600r, where r is the rate of interest in decimal form. Graph i=8,600r, for r up toincluding a rate of 16%. If the rate is 7%, how much interest is earned?OA. $6,020OB. $602O C. $586OD. $622I

Simple interest is paid out and computed only on the initial principal amount.Unlike compound…

Answered: When $8,600 is invested in a savings…

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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Suppose $1,200 is deposited into an account which has an annual percentage rate of 9.81% per year. Assume it remains in the account for 18 years and no additional money is added to the account other than interest. (a) Complete the boxes below to write an expression for the amount (in dollars) at year x = 18, of assuming interest is compounded annually. Do not round any values. You can enter arithmetic expressions (containing +, -, *, /, or ^) in any of these boxes. Number 1200 •( Number What is the value in year x = 18 of an investment of $1,200 dollars which pays 9.81% compounded annually? $ Number (Round to the nearest 0.01 dollars) (b) Complete the boxes below to write an expression for the amount (in dollars) at year x = 18, assuming interest is compounded weekly (52 times per year). Do not round any values. You can enter arithmetic expressions (containing +, –, *, /, or ^) in any of these boxes. Number 1200 ( Number What is the value in year x = 18 of an investment of $1,200…
4. Suppose $5,000 is deposited in a savings and loan account that pays 5.5% interest compounded semiannually. Use compound interest to calculate the following:a. How much money will be saved?b. How much will be owed after 2 years?
Find the accumulated amount A if the principal P is invested at the interest rate of r/year for t years. (Use a 365-day year. Round your answer to the nearest cent.) P = $120,000, r = 2.75%, t = 4, compounded daily
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"?
Compute for the simple interest earned given the principal P, interest rate r and time t. a) P = 10,000 pesos; r = 5%; t = 3 b) P = 100,000 pesos; r = 20%; t = 7 months c) P = 25,000 pesos; r = 12.5%; t = 165 days (ordinary interest)
Suppose Eli deposits $1,000 into a savings account. The savings account earns4.2% compounded monthly. Find the APY for the account. Round the percent to two decimals.
You are told that a note has repayment terms of $1,700 per quarter for 6 years, with a stated interest rate of 8%. How much of the total payment is for principal, and how much is for interest? Calculate using (a) financial calculator or (b) Excel function PV. (Round answers to 2 decimal places, eg. 5,275.25.) Total payment for principal Total interest Determine if the total interest will be higher or lower than with an annual payment. The total interest will be than with an annual payment.
Using Table 11-1, compute the amount of compound interest (in $) earned in 1 year and the annual percentage yield (APY) for the investment. (Round your answers to two decimal places.) Compound Interest Earned in 1 Year Annual Percentage Yield (APY) Nominal Interest Principal Rate (%) Compounded $33,000 12 monthly $ % Need Help? Read It 3 Type here to search
Suppose you deposit $1,751.00 into an account today that earns 5.00%. It will take ___ years for the account to be worth $2,806.00. Answer format: Number: Round to: 2 decimal places.
Using Table 11-1, calculate the compound amount and compound interest (in $) for the investment. (Round your answers to the nearest cent.) Time Nominal Interest Compound Compound Principal Period (years) Rate (%) Compounded Amount Interest $5,100 8 quarterly Need Help? Read It
= A bank features a savings account that has an annual percentage rate of r interest compounded quarterly. Tatiana deposits $9,000 into the account. The account balance can be modeled by the exponential formula A(t) = a (1 + 7-)kt, where A is account value after t years, a is the principal (starting amount), r is the annual percentage rate, k is the number of times each year that the interest is compounded. (A) What values should be used for a, r, and k? a = r = 5.6% with k = (B) How much money will Tatiana have in the account in 7 years? Answer = $ 7. Round answer to the nearest penny. APY = = %. Round answer to 3 decimal places. (C) What is the annual percentage yield (APY) for the savings account? (The APY is the actual or effective annual percentage rate which includes all compounding in the year).
Suppose that $4500 is invested in an account that pays 2% annually and is left for 4 years. 1) How much will be in the account if interest is compunded quarterly? 2) How much will be in the account if interest is compouded continuously?

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