[SPLIT] $4000 for 8 yrs at 7%: compound yrly, monthly, cont.

A

almars06

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Nov 29, 2007
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1. Suppose you deposit $4000 for 8 years at a rate of 7%.

2. Calculate the return (A) if the bank compounds annually (n=1). Round you answer to the hundredth's place.

3. Calculate the return (A) if the bank compounds monthly (n=12). Round you answer to the hundredth's place.

4. Which yeilds the most interest monthly or annually and why?

5. If a bank compounds continuously then the formula used is A=Pert (e is raised to the power of rt) where e is a constant and equals approximately 2.7183.
Calculate A wiht continuous compounding. Round your answer to the hunderdth's place.

6. How long will it take to double my money? At 7% interest rate and continuous compounding, what is the answer to the nearest hunderdth place.
 
They've given you the values to plug into the formulas you were taught. Where are you stuck? :?:

Please reply with a clear listing of all of your steps and reasoning. Thank you! :D

Eliz.
 
After a second well rested look I was able to figure the problems out. Thanks for you reply. Thanks for chiming in. :wink:
 
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