a) Find the balance of the investment if $1000 is compounded annually, at 5%/a, for 20 years.
b). Tiffany deposits $9000 in an account that pays 10%/a, compounded quarterly. After three years, the interest rate changes to 9%/a, compounded semi-annually. Calculate the value of her investment two years after this change.
c). On the day Sarah was born, her grandparents deposited $500 in a savings account that earns 4.8%/a, compounded monthly. They deposited the same amount on her 5th, 10th and 15th birthdays. Determine the balance in the account on Sarah’s 18th birthday.
a) 1000(1 + .05) 20
b) 9000 ( 1 + .1/4)12 = .......... use this value in the second part
value * (1 + .09/2)4 = final amount
c ) this is really four results that you add together
500 ( 1 + .048/12)12*18 +
500 ( 1 + .048/12)13*12 +
500 (1 + .048/12)8*12 +
500 ( 1+ .048/12)3*12 = total amount when 18 y/o
a) 1000(1 + .05) 20
b) 9000 ( 1 + .1/4)12 = .......... use this value in the second part
value * (1 + .09/2)4 = final amount
c ) this is really four results that you add together
500 ( 1 + .048/12)12*18 +
500 ( 1 + .048/12)13*12 +
500 (1 + .048/12)8*12 +
500 ( 1+ .048/12)3*12 = total amount when 18 y/o
