Math 71 Supplement 9-15-09

Math 71 Supplement 9-15-09 - Math 71 Supplement 9-15-09 a...

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Math 71 Supplement 9-15-09 Suppose a person invest $P in an account that earns 100r % in (annual) interest compounded k times annually. Then after n time compounding period, the amount $A in the account is given by A = P 1+ i ( ) n , where i = r k . 1. Suppose a person invest $1,234 in an account that earns in interest 3.2% compounded annually in interest. How much will this person have after 76 months? 2. Suppose a person invest $1,234 in an account that earns in interest 3.2% compounded semi-annually in interest. How much will this person have after 76 months? 3. Suppose a person invest $1,234 in an account that earns in interest 3.2% compounded quarterly in interest. How much will this person have after 76 months? 4. Suppose a person invest $1,234 in an account that earns in interest 3.2% compounded monthly in interest. How much will this person have after 76 months? 5. Suppose a person invest $1,234 in an account that earns compounded monthly interest. After 70 month, she has $1,500. What is the interest rate of the account?
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