3. Compound interest Old Time Savings Bank pays 4% interest on its savings account. If you deposit $1,000 in the bank and leave it there: a. How much interest will you earn in the first year? b. How much interest will you earn in the second year? c. How much interest will you earn in the tenth year?

3. Compound interest Old Time Savings Bank pays 4% interest on its savings account. If you deposit $1,000 in the bank and leave it there: a. How much interest will you earn in the first year? b. How much interest will you earn in the second year? c. How much interest will you earn in the tenth year?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

If you deposit OMR 8854 in your account in a bank. Suppose the bank pays 8% compound interest half yearly. Calculate future value of your money in 5 years. a. 13106.04 b. 13009.18 c. 19114.90 d. All the given choices are not correct
Your savings account pays 6% annually. Assuming this interest rate remains constant, how much do you need to deposit in your savings account today to accumulate $200 in 4 years? Round to the nearest cent. O A. $164.17 O B. $158.42 OC. $172.38 O D. $186.81
a. You need $17,000 in five years but you only have $12,000 now. At what interest rate must you invest the money assuming the interest is compounded annually? b. You have a $20,000 note payable which is due in three years. How much money must you put into a savings account today in order to have enough money to pay off the debt on time assuming your savings account earns 3% interest compounded annually? c. You put $2,750 into an account earnings 4% interest compounded QUARTERLY. How much will be in this account at the end of 4 YEARS? d. In question “b." above, if you leave he money in the account for one more YEAR, how much more interest will you earn in that additional year (Year 5)? e. How long will it take to double $2,000 to $4,000 assuming you invest the $2,000 into an account earning 7% interest compounded annually?
3. You invest some amount today for two years that pays 6% annually. The bank compounds annually. At the end of the two years, you will have $150. What amount must you invest today?
QUESTION 1 Considering the following scenario. In years 0, 2, 4, 6, and 8, you deposit $750 in your savings account. The saving account earns 4.25% compounded anbually. What is the future value in year 10? 4,847.22 5,411.56 3,579.94 6,411.56
The Bank pays $1,200 in a bank deposit after a period of 12 years at an annual interest rate of 6.5% How much should you deposit in your bank account now Future Value ? Discount Rate/Period ? No. of Periods ? Present Value ?
A person deposited an amount of 1000 dinars in a savings account, what is the accumulated amount in that account after 6 years if the interest rate is 16%, paid once every six months, and four times annually???
24) One of the local banks indicates that it computes the interest it pays on savings accounts by the continuous compounding method. Suppose you deposited $100 in the bank and they pay 4% per annum, compounded continuously. After 5 years, how much money will there be in the account? Select one: a. $ 122.14 b. $ 144.14 c. $ 322.14 d. $ 222.14 25) At 10% per year simple interest, how long will it take for a deposit of $1000 now to accumulate to $100,000? Select one: a. n=99 years b. n=50 years c. n=44 years d. n= 990 years 26) When only one alternative can be selected from two or more, the alternatives are said to be: Select one: a. subjective alternatives b. independent alternatives c. revenue alternatives d. mutually exclusive
5. You take $100 to your local savings bank to invest for five years. You are given the choice of two investments by the banker Notifications Time Left 00:00:28 ? Guide Me 1. You can Invest in a regular savings account that pays you 14.00% interest each year with interest compounded annually. That is each year the interest you can gets deposited in your bank account and earns interest until the end of the five years. it. You can invest in a special account that pays you 20.00% interest each year, the catch is that the interest does not compound, Rattier each year the interest payrrient is put into a special account which collects no further interest and cannot be reinvested anywhere until the end of the five years Which option should you select and why? a, Select Option i: It earns $44.63 more than Optianill b. Both Options earn you the same amount of money so you are indifferent between the two c. Select Option it It earns $7.46 more than Option d. Select Option it It earns $30.00…
Suppose you deposit $4,000 in a savings account paying 10% simple interest. How much money will you have in your account after 4 years?
You took out a student loan in college and now have to pay $1,200 every year for 10 years, starting one year from now. The annual interest rate on the loan is 4%. Part 1 What is the your student loan balance as of now? p+ decimals
K If your bank pays you 1.4% interest and you deposit $800 today, what will be your balance in five years? The bank balance will be S[ .... (Round to the nearest cent.)

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