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# Compound interest HELP!

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2736
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IF you have \$28210.00 to invest, how much interest will you earn on a 6 year investment with an interest rate of 3.10% per annum, compounded daily?
Jan 27, 2012

#3
+118623
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## This is PROOF !!!!!

Apr 15, 2015

#1
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1year = 365.2425days (leap years included, gregorian calendar days)
t = 6years = 2191.455days

interest rate per day: x = 3.10% / 365.2425
C=28210.00\$

compound interest P:
P = C*(1+x)t
P= 28210.00\$ * (1+3.10% / 365.2425)^2191.455 = 33976.48\$
Jan 27, 2012
#2
+1002
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WOW this was years ago!!!

Apr 14, 2015
#3
+118623
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## This is PROOF !!!!!

Melody Apr 15, 2015
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#Mind-Blown!

May 9, 2015
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Don't complicate things unnecessarily!!!.

First, convert the interest rate from daily compound to annual effective rate.

So, 3.10%=.0310/365+1=1.0000849315.......etc.,.............(1)

Then raise (1) above to 365th power, which gives you annual effective rate of

1.0314841460.....etc........................................................(2)

Raise (2) above to the 6th power(for 6 years) & multiply it by the principal, or:

(1.0314841460)^6 X \$28,210=\$33,976.48 - \$28210=\$5,766.48, which is total interest over 6 years.

.

Aug 19, 2015