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ef2452_B07_PS6 - year to year(a The interest paid by the...

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Mathematics for Economics & Finance (EF 2452) Problem Set#6 Due: Week 7 Tutorial Class Please write your name, student ID and tutorial number on top of your answer sheet. Q1. Your bank pays you 4% interest per year on the balance in your account, but they also charge you $250 per year in bank fees. In each of the following situations, how much do you need to keep in your account so that the balance will not change from
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Unformatted text preview: year to year? (a) The interest paid by the bank is compounded semi-annually (i.e. every six months). (b) The interest paid by the bank is compounded continuously. Q2. Practice Problem 3 (page 213) from Chapter 3.3 in Jacques’ textbook . Q3. Practice Problem 15 (page 235) from Chapter 3.4 in Jacques’ textbook ....
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