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determine i. the interest rate for each conversion period ii. the number of conversion periods

1. a deposit at 8.2%/a, compounded quarterly, for 16 months

2. a loan at 5.2%/a, compounded weekly, for 2 years

 

Determine: i. the amount ii. ii. the interest earned

a. $7500 invested for 6 years at 6%/a, compounded monthly

b. $28 200 invested for 10 years at 5.5%/a compounded semi-annually

 Feb 13, 2021
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1. 8.2% pa  compounded quarterly is really     8.2/4 % per quarter,  (because there are 4 quarters in a year)

    16 months = 16*4 = 64 quarters.

 

 

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a. $7500 invested for 6 years at 6%/a, compounded monthly

 

6% per annum compounded monthly is really  0.5% = 0.005 per month

 

6*12=72 months

 

7500*1.005^72 = $10740.33

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You can do the other 2 yourself.

 Feb 14, 2021

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