Explanation Formula used: Write the compound interest formula which is used, A = P ( 1 + i ) n Here, A is accumulated amount at the end of n conversion periods, P is principal, r is nominal interest rate per year, m is number of conversion periods per year and t is the term or number of years. Write the expression to find i , i = r m Write the expression to find n , n = m t Calculation: Substitute 1 for m and 3.5 % for r and find i , i = 3.5 % 1 = 3.5 100 1 = 0.035 Substitute 1 for m and 8 years for t to find n , To determine b) To find: The accumulated amount after 8 years if the $ 12 , 000 is invested at 3.5 % per year compounded semiannually. To determine c) To find: The accumulated amount after 8 years if the $ 12 , 000 is invested at 3.5 % per year compounded quarterly. To determine d) To find: The accumulated amount after 8 years if the $ 12 , 000 is invested at 3.5 % per year compounded monthly.

Finite Mathematics for the Managerial, Life, and Social Sciences

12th Edition

ISBN: 9781337405782

Author: Soo T. Tan

Publisher: Cengage Learning

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Chapter 5.CRE, Problem 2CRE

To determine

a)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded annually.

To determine

b)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded semiannually.

To determine

c)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded quarterly.

To determine

d)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded monthly.

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Chapter 5.CRE, Problem 1CRE

Chapter 5.CRE, Problem 3CRE

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Chapter 5 Solutions

Finite Mathematics for the Managerial, Life, and Social Sciences

Ch. 5.1 - Explain the difference between simple interest and...Ch. 5.1 - Prob. 2CQ Ch. 5.1 - Prob. 3CQ Ch. 5.1 - Find the simple interest on a 500 investment made...Ch. 5.1 - Prob. 2E Ch. 5.1 - Find the accumulated amount at the end of 9months...Ch. 5.1 - Find the accumulated amount at the end of 8months...Ch. 5.1 - Prob. 5E Ch. 5.1 - A bank deposit paying simple interest at the rate...Ch. 5.1 - How many days will it take for 1000 to earn 20...

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a) To find: The accumulated amount after 8 years if the $ 12 , 000 is invested at 3.5 % per year compounded annually.

Solution Summary: The author explains the compound interest formula used to find the annual accumulated amount of 15,801.71.

Concept explainers

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a)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded annually.

b)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded semiannually.

c)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded quarterly.

d)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded monthly.

Want to see the full answer?

Chapter 5 Solutions

a) To find: The accumulated amount after 8 years if the $ 12 , 000 is invested at 3.5 % per year compounded annually.

Solution Summary: The author explains the compound interest formula used to find the annual accumulated amount of 15,801.71.

Concept explainers

Videos

a) To find: The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded annually.

b) To find: The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded semiannually.

c) To find: The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded quarterly.

d) To find: The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded monthly.

Want to see the full answer?

Chapter 5 Solutions

a)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded annually.

b)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded semiannually.

c)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded quarterly.

d)

To find:

The accumulated amount after 8 years if the $12,000 is invested at 3.5% per year compounded monthly.