First City Bank pays 7.5 percent simple interest on its savings account balances, whereas Second City Bank pays 7.5 percent interest compounded annually. If you made a deposit of $8,600 in each bank, how much more money would you earn from your Second City Bank account at the end of eight years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Difference in accounts

First City Bank pays 7.5 percent simple interest on its savings account balances, whereas Second City Bank pays 7.5 percent interest compounded annually. If you made a deposit of $8,600 in each bank, how much more money would you earn from your Second City Bank account at the end of eight years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Difference in accounts

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

Bank of vancouver pays 7% simple interest on its saving account balances, whereas bank of calgary pays 7% interest compounded anually. If you made a $6000 deposit in each bank, how much more money would you earn from your bank of calgary account at the end of nine years?
First City Bank pays 5 percent simple interest on its savings account balances, Second City Bank pays 5 percent interest compounded annually. If you made a deposit of $13,500 in each bank, how much more money would y from your Second City Bank account at the end of 11 years? (Do not round inter calculations and round your answer to 2 decimal places, e.g., 32.16.) Difference
= A bank features a savings account that has an annual percentage rate of r interest compounded quarterly. Tatiana deposits $9,000 into the account. The account balance can be modeled by the exponential formula A(t) = a (1 + 7-)kt, where A is account value after t years, a is the principal (starting amount), r is the annual percentage rate, k is the number of times each year that the interest is compounded. (A) What values should be used for a, r, and k? a = r = 5.6% with k = (B) How much money will Tatiana have in the account in 7 years? Answer = $ 7. Round answer to the nearest penny. APY = = %. Round answer to 3 decimal places. (C) What is the annual percentage yield (APY) for the savings account? (The APY is the actual or effective annual percentage rate which includes all compounding in the year).
Determine the interest rate earned on a $2,300 deposit when $2,600 is paid back in one year. (Round your answer to 2 decimal places.)
A bank customer saved 5000 PLN on the savings account. The deposit lasted for 2 years. For the first 6 months continuous interest rate method was used with the 4,5% nominal interest rate, for the next 9 months compound interest rate method was used, and during the last months simple interest rate method was used also with 4,5% nominal interest rate (after each change in the interest method, interest was added to the account balance). Please calculate what was the nominal interest rate in the second period if the profit from the deposit was 414,70 PLN after the whole 2 years period?
Five years ago, you deposited $1,000 in a bank account. One year ago, you deposited $2,000 in the same bank account. Assuming no other deposits and no withdrawals, what will be in the account 7 years from now? Assume an interest rate of 4%. Use the $ symbol and round to the nearest dollar...no decimal places...use a comma.
Assume Jed Gerbil invested $ 12,524 into an account exactly two years ago. The account has an interest rate of 13.1 % p.a. How much does Jed have in his account today (that is, exactly two years after the initial deposit)? (Round your answer to the nearest cent and record your answer without a dollar sign and without commas. For example, record $1,356.8382 as 1356.84).
sample and compound
Southern Bank offers 10% interest and interest is compounded annually. West Bank offers 9% interest and interest is compounded on monthly basis. Both banks return principal and interest at the end of five years. Which one of the two banks you would prefer to deposit your savings? A) Southern Bank B) Western Bank C) Both are equal and hence indifferent D) None of the above.
If you withdraw part of your money from a certificate of deposit before the date of maturity, you must pay an interest penalty. Suppose you invested $7000 in a one-year certificate of deposit paying 8.1% interest. After 6 months, you decide to withdraw $7000. Your interest penalty is 3 months simple interest on the $7000. What interest penalty do you pay? (Round your answer to two decimal places)
First City Bank pays 7 percent simple interest on its savings account balances, whereas Second City Bank pays 7 percent interest compounded annually. If you made a deposit of $56,000 in each bank, how much more money would you earn from your Second City Bank account at the end of 9 years/ Whats the difference in accounts?

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