8. Find the accumulated amount A if the principal P is invested at the interest
ID: 2775286 • Letter: 8
Question
8. Find the accumulated amount A if the principal P is invested at the interest rate of r/year for t years. (Use a 365-day year. Round your answer to the nearest cent.) P = $210,000, r = 6%, t = 3, compounded daily
A= $
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9. Find the effective rate corresponding to the given nominal rate. (Assume a 365-day year. Round your answer to two decimal places.)
8%/year compounded semiannually %/year
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10. Find the effective rate corresponding to the given nominal rate. (Assume a 365-day year. Round your answer to two decimal places.)
8%/year compounded quarterly
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11. Find the effective rate corresponding to the given nominal rate. (Assume a 365-day year. Round your answer to two decimal places.) 8%/year compounded daily
%/year
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12. Find the present value of $40,000 due in 3 years at the given rate of interest. (Round your answer to the nearest cent.)
10%/year compounded quarterly
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13. Find the present value of $40,000 due in 3 years at the given rate of interest. (Round your answer to the nearest cent.)
10%/year compounded daily
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14. Find the accumulated amount after 4 yr if $3000 is invested at 7%/year compounded continuously. (Round your answer to the nearest cent.)
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15. Jennifer was awarded damages of $150,000 in a successful lawsuit she brought against her employer 3 years ago. Interest (simple) on the judgment accrues at the rate of10%/year from the date of filing. If the case were settled today, how much would Jennifer receive in the final judgment?
Explanation / Answer
8. Equation:A = P(1 + rt)
Calculation:
First, converting R percent to r a decimal
r = R/100 = 6%/100 = 0.06 per year,
then, solving our equation
A = 210000(1 + (0.06 × 3)) = 247800
A = $ 247,800.00
12. Present Value (PV)= FV(1+i)-n
40,000(1+10)-3
=$ 29,742.24
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