The Continental Bank advertises capital savings at 6.1% compounded annually while TD Canada Trust offers premium savings at 5.9% compounded monthly Suppose you have $2500 to invest for two years. (a) Which deposit will earn more interest? (b) What is the difference in the amount of interest? (2) (a) The (b) The difference is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed) savings account will earn more interest.

The Continental Bank advertises capital savings at 6.1% compounded annually while TD Canada Trust offers premium savings at 5.9% compounded monthly Suppose you have $2500 to invest for two years. (a) Which deposit will earn more interest? (b) What is the difference in the amount of interest? (2) (a) The (b) The difference is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed) savings account will earn more 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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write down an answer, without showing any work, you will receive only half credit for that problem if you are correct (anc rong). The point is that I want to see that you know how to set up each problem. Question 1 Calculate the effective interest rate for each nominal annual interest rate and compounding frequency shown. Round your answer to 2 decimal places. a. 12% Quarterly compounding b. 7% Semiannual compounding C. 14% Continuous compounding Upload Choose a File Question 2 You are looking at buying a new sorting machine for recycling plastics that sod 6 11-15od
Deposits of $99.00 are made at the end of every quarter for 9.25 years. What will the deposits amount to if interest is 4% compounded quarterty? The future value is $. (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Could you please help me to solve this?
The Royal Bank of Canada offers a rate of 2.0% compounded semi-annually on its three-year GIC. What monthly compounded rate should the bank offer on three-year GICS to make investors indifferent between the alternatives? Show your work using the FORMULA method to find the answer (round to two decimals)
Bank A offers you a loan at 8.52% compounded 5 times a year. Bank B offers to loan you the same amount at 0.10% less than the rate offered by Bank A but compounded twice as often as the Bank A rate is. Which bank's loan should you accept? As your answer, enter the effective rate (in percent, to two decimal places at least) offered by the bank whose loan you should accept.
Suppose you borrow $14,000. The interest rate is 11%, and it requires 4 equal end-of-year payments. Set up an amortization schedule that shows the annual payments, interest payments, principal repayments, and beginning and ending loan balances. Round your answers to the nearest cent. If your answer is zero, enter "0". Beginning Repayment Ending Year Balance Payment Interest of Principal Balance 1 $ fill in the blank 60 $ fill in the blank 61 $ fill in the blank 62 $ fill in the blank 63 $ fill in the blank 64 2 $ fill in the blank 65 $ fill in the blank 66 $ fill in the blank 67 $ fill in the blank 68 $ fill in the blank 69 3 $ fill in the blank 70 $ fill in the blank 71 $ fill in the blank 72 $ fill in the blank 73 $ fill in the blank 74 4 $ fill in the blank 75 $ fill in the blank 76 $ fill in the blank 77 $ fill in the blank 78 $ fill in the blank 79
How long will it take $200 to double if it earns the following rates? Compounding occurs once a year. Round your answers to two decimal places. 4%. year(s) 13%. year(s) 17%. year(s) 100%. year(s)
FlybynightSavings.com is offering a savings account that pays 32% compounded continuously. How much interest would a deposit of $4,000 earn over 5 years? (Round your answer to the nearest cent.) $= What is the annually compounded interest rate (in percent) that would correspond to this investment? (Round your answer to two decimal places.) %
How long will it take $800 to double if it earns the following rates? Compounding occurs once a year. Round your answers to two decimal places. 6%. year(s) 11%. year(s) 17%. year(s) 100%. year(s)
Percentages need to be entered in decimal format, for instance 3% would be entered as .03 in the interest rate cells.) At the end of each of the past 14 years, Vanessa deposited $450 in an account that earned 8% compounded annually. How much is in the account today? How much would be in the account if the deposits were made at the beginning of each year (PMT Type) than at the end of each year? (Use Future Value of an Annuity) Suppose your opportunity cost (interest rate/year) is 11% compounded annually. How much must you deposit in an account today if you want to pay yourself $230 at the end of each of the next 15 years? How much must you deposit if you want to pay yourself $230 at the beginning of each of the next 15 years? Bruce invested $1,250 (present value - enter as a negative number) 10 years ago. Today, the investment is worth $3,550 (future value). If interest is compounded annually, what annual rate of return did Bruce earn on his investment? (Use Solving for r…
You have found three investment choices for a one-year deposit: 10.4% APR compounded monthly, 10.4% APR compounded annually, and 9.7% APR compounded daily. Compute the EAR for each investment choice. (Assume that there are 365 days in the year.) (Note: Be careful not to round any intermediate steps less than six decimal places.) The EAR for the first investment choice is _____%. (Round to three decimal places.) Part 2 The EAR for the second investment choice is _____%. (Round to three decimal places.) Part 3 The EAR for the third investment choice is______%. (Round to three decimal places.)
Compute The present value of a $5500 deposit in year 1, and another $5000 deposit at the end of year 4 using an 8% interest rate. ( do not round intermediate calculations and around your final answer to two decimal places)

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