Explanation Given information: An investment made for 6 years at 6 % compounded monthly. Formula used: Compounding period can be defined as the duration or length of time from one interest payment to the next. If an investment made for 4 years at 6 % compounded annually (once per year) then it would have four compounding period which can be calculated by formula given below: Compounding periods = Term of investments ( years ) × n Here, n is the period per year. The interest rate per period can be calculated by dividing the annual, or nominal, rate by the number of periods per year, Interest rate per period = Nominal rate Period per year Calculation: Consider the investment made for 6 years at 6 % compounded monthly and solve as shown below: Since, the variables- term of investment (years),

Contemporary Mathematics for Business & Consumers - With LMS CengageNOW

8th Edition

ISBN: 9781337125468

Author: Brechner

Publisher: Cengage

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Chapter 11.I, Problem 4RE

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To calculate: The total number of compounding periods and the interest rate per period when an investment made for 6 years at 6% compounded monthly.

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Chapter 11 Solutions

Contemporary Mathematics for Business & Consumers - With LMS CengageNOW

Ch. 11.I - Gail Parker invested $10,000 at 6% interest...Ch. 11.I - Jenny Chao invested $20,000 at 6% interest...Ch. 11.I - Prob. 3TIE Ch. 11.I - Jill Quinn invested $7,000 in a certificate of...Ch. 11.I - Prob. 5TIE Ch. 11.I - Prob. 1RE Ch. 11.I - For the following investments, find the total...Ch. 11.I - For the following investments, find the total...Ch. 11.I - Prob. 4RE Ch. 11.I - Prob. 5RE

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The total number of compounding periods and the interest rate per period when an investment made for 6 years at 6 % compounded monthly.

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To calculate: The total number of compounding periods and the interest rate per period when an investment made for 6 years at 6% compounded monthly.

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Chapter 11 Solutions