Suppose that $1,000 is invested at 5% interest compounded monthly. Use the formula A = (1+)". (a) How long (to the nearest month) before the value is $1,250? years, months (b) How long (to the nearest month) before the money doubles? years, months (c) What is the interest rate (compounded monthly and rounded to the nearest percent) if the money doubles in 5 years? %

Suppose that $1,000 is invested at 5% interest compounded monthly. Use the formula A = (1+)". (a) How long (to the nearest month) before the value is $1,250? years, months (b) How long (to the nearest month) before the money doubles? years, months (c) What is the interest rate (compounded monthly and rounded to the nearest percent) if the money doubles in 5 years? %

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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Suppose that $1,000 is invested at 5% interest compounded monthly. Use the formula A = (1+)". (a) How long (to the nearest month) before the value is $1,250? years, months (b) How long (to the nearest month) before the money doubles? years, months (c) What is the interest rate (compounded monthly and rounded to the nearest percent) if the money doubles in 5 years? %
Suppose that $1,000 is invested at 4% interest compounded continuously. Use the formula A = Pert. (a) How long (to the nearest day) before the value is $1,250? years, days (b) How long (to the nearest day) before the money doubles? years, days (c) What is the interest rate (compounded continuously and rounded to the nearest tenth of a percent) if the money doubles in 5 years? %
Suppose that $1,000 is invested at 7% interest compounded monthly. Use the formula nt A = P 1 + (a) How long (to the nearest month) before the value is $1,250? 3 years, 3 months (b) How long (to the nearest month) before the money doubles? 10 x years, 0 xmonths (c) What is the interest rate (compounded monthly and rounded to the nearest percent) if the money doubles in 5 years? 13.94
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