6 Q43 Compound Interest Future Value Calculate the future value A for each of th

Question

6 Q43 Compound Interest Future Value Calculate the future value A for each of the following: The future value will consist of the orginal principal plus any accumulated interest. Hint: Use the formula A - P(l +i) where n = (number of years) x (number of compounding periods per year) i interest rate per compounding period. i must be decimal. P = the amount deposited, also called the present value.. Round your final answer to the nearest cent. 3 points each (a) $8,500 deposited for 10 years at a annual percentage rate (APR) of 6% cornpounded monthly. (b) S2.600 deposited for 7 years at a annual percentage rate (APR) of 6% compounded quarterly (c) $2,600 deposited for 11 years at a annual percentage rate (APR) of 6.9% compounded annually

Explanation / Answer

A) A = 8500 * (1 + 6/1200)12 * 10

= 8500 * (201/200)120

= 15464.87

B) A = 2600 * (1 + 6/400)4 * 7

= 2600 * (406/400)28

= 3944.78

C) A = 2600 * (1 + 69/1000)11

= 2600 * (1069/1000)11

= 5416.62

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