1 - 5.1 Exercise Page 269-4, 6 and 42 4. Find the...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
5.1 Exercise Page 269----------4, 6 and 42 4. Find the accumulated amount at the end of 8 mo on a $1200 bank deposit paying simple interest at a rate of 7%/year. I=Prt I=1200*0.07*0.667 I=56 ------- 1200+56=1256 6. A bank deposit paying simple interest at the rate of 5%/year grew to a sum of $3100 in 10 mo. find the principal. A = original principal P = final amount i = annual interest rate P = A +Ai 3100 = A + A(10)(0.05/12) 3100 = A(1 + (10)(0.05/12)) A = $2,976 . 42. Retirement Funds: Five and a half years ago, Chris invested $10,000 in a retirement fund that grew at the rate of 10.82%/year compounded quarterly. What is his account worth today? A=10000(1+.1082/4)^4*5.5 A=(10000(1.02705)^22 A=10000*1.7989 A=$17,989 5.2 Exercise Page 284----------16 and 28 16. Savings Accounts: If Jackson deposits $100 at the end of the month in a savings account earning interest at the rate of 8%/year compounded monthly, how much will he have on a deposit in his savings account at the end of 6 yr, assuming that he makes no withdrawals during that period? We will use the formula Balance = A(1 + r)^nt - (P/r)[(1+r)^nt - 1] Here n = 12, t = 6, A = 0 (initial amount zero) P = 100, r= 8% = 0.08, n = 12 and t = 6
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Sorry, r = 8%/12 = 0.00667 Now balance = (100/0.00667) [ (1+ 0.00667)^(12*6) - 1]
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 12/12/2011 for the course ECONOMIC acc 101 taught by Professor Xyz during the Spring '11 term at University of Phoenix.

Page1 / 3

1 - 5.1 Exercise Page 269-4, 6 and 42 4. Find the...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online