Compare the interest earned by $10,000 for three years at 7% simple interest with interest earned by the same amount for three years at 7% compounded annually Why does a difference occur?A Click the icon to view the interest and annuity table for discrete compounding when =7% per yearThe simple interest earned is $ (Roundthe nearest dollar.)The compound interest earned is S. (Round to the nearest dollaronly considers the original principal.There is a difference in the amount of interest earned becauseY allovs interest from previous years to earn additional interast, whereascompaund interestsimple interestEnter your answer in each of the answer boxes

For simple interest =Principal(P)*Rate(i)*Time(n) For compounding interest =Principal[(1+i)n -1]…

ence occur Compare the interest earned by $10,000 for three years at 7% simple interest with interest earned by the same amount for three years at 7%% compounded annually Why does a B Click the icon to view the interest and annuity table for discrete compounding when =7% per year The simple interest earned is $ (Round to the nearest dollar) The compound interest earned is S (Round to the nearest dollar) V allovs interest from previous years to earn additional interest whereas only considers the original principal. There is a difference in the amount of interest earned because compaund interest simple interest

ence occur Compare the interest earned by $10,000 for three years at 7% simple interest with interest earned by the same amount for three years at 7%% compounded annually Why does a B Click the icon to view the interest and annuity table for discrete compounding when =7% per year The simple interest earned is $ (Round to the nearest dollar) The compound interest earned is S (Round to the nearest dollar) V allovs interest from previous years to earn additional interest whereas only considers the original principal. There is a difference in the amount of interest earned because compaund interest simple interest

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

Which of the following give the highest amount of interest for depositing the same amount of money for 2 years? 5% annual interest rate, no compounding ○ 4.94% annual interest rate, compounding semi-annually 4.92% annual interest rate, compounding monthly 4.9% annual interest rate, compounding daily 4.88% annual interest rate, compounding continuously
Suppose the interest rate is 10.2 % APR with monthly compounding. What is the present value of an annuity that pays $ 119 every 6 months for 6 years? Question content area bottom Part 1 The 6 -month effective interest rate is 5.209 %. (Round to three decimal places.) Part 2 The present value is $enter your response here . (Round to the nearest cent.)
Complete the following using compound future value. (Use the Table provided.) Time Principal Rate Compounded Amount Interest 6 months $15,000 6 % Semiannually
Calculate interest using a 360-day year. If required, round your answers to the nearest cent.
Simple and Compound Interesta. For each of the following notes, calculate the simple interest due at the end of the term. Round to the nearest dollar. Note Principal Rate Term 1 $18,000 4% 6 years 2 $18,000 6% 4 years 3 $18,000 8% 3 years Note 1 Answer Note 2 Answer Note 3 Answer b. Compute the amount of interest due at the end of the term for each of the above notes assuming interest is compounded annually.Use Excel or a financial calculator for your computations. Round your answer to the nearest dollar. Note 1 Answer Note 2 Answer Note 3 Answer
Complete the following using compound future value. (Use the Table provided.) (Round your answers to the nearest cent.) Time Principal Rate Compounded Amount Interest 10 years $17,100 4% Annually $ $
Compound Interest Table Complete the following schedule for investments a through f by indicating the relevant factor from the present value or future value table and the final present or future value amount. Investment Compounding a. Annuity b. Annuity Annually Semiannually Semiannually Annually c. Annuity d. Single Payment e. Single Payment Semiannually f. Single Payment Semiannually Factor Answer $ a. $ Annual Interest Rate Amount 5% $2,000 4% 1,000 6% 14,000 •Note: Round your answers to the nearest whole dollar. •Note: Do not use a negative sign (-) with your answers. b. 5% 9,000 6% 16,000 4% 9,600 $ C. Investment $ Period d. $ Payment at Beg. or End e. of Period 2 years End 3 years Beginning 4 years Beginning 6 years n/a 5 years n/a 4 years n/a $ f. Future Value or Present Value Future Present Future Present Future Present
21.Calculate the present value (principal) and the compound interest (in $). Use Table 11-2. Round your answers to the nearest cent. CompoundAmount Term ofInvestment NominalRate (%) InterestCompounded PresentValue CompoundInterest $8,000 12 years 6 semiannually $ $
find the future value and the compound interest. principal: $1,465 Rate 0.4% compund: semi-annually time: 11 years round answers to the nearest cent
Which interest gives the lowest present value? (Compounding Monthly) a. 5,000 monthly, nominal interest of 8%, 5 years b. 15,000 quarterly, effective interest per period of 2.30%, 5 years c. 5,000 monthly, interest rate per period of 0.8%, 5 years
Following is a table for the present value of $1 at compound interest: Year 6% 10% 12% 1 0.943 0.909 0.893 2 0.890 0.826 0.797 3 0.840 0.751 0.712 4 0.792 0.683 0.636 5 0.747 0.621 0.567 Following is a table for the present value of an annuity of $1 at compound interest: Year 6% 10% 12% 1 0.943 0.909 0.893 2 1.833 1.736 1.690 3 2.673 2.487 2.402 4 3.465 3.170 3.037 5 4.212 3.791 3.605 Using the tables provided, the present value of $6,000 to be received at the end of each of the next 4 years, assuming an earnings rate of 10%, is Group of answer choices $25,272 $19,020 $20,790 $14,412
How to Find the future value and compound interest on $6,000 at 4% compounded semiannually for two years and how to use the future value or compound amount of $1.00 Table or the future value and compound interest formula. What is the future value?

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