Question

Find the value of $10000 at the end of one year if it is invested in an account that has an interest rate of 4.95% and is compounded in accordance with the rules below. (a). compounded monthly (b). compounded daily (assuming a 365- day year) (c). compounded quarterly

Answer 1

Do you know the compound interest formula?

Answer 2

\[F=P(1+{r \over n})^{nt}\]F=Future amount
P=Initial amount
r=annual interest rate
n=number of times compounded in a year
t=number of years.

So, for (a), compounded monthly. n=12, t=1, P=10000, r=0.0495. Substitute all that in and you'll have your F, the future amount.

Answer 3

Actually they are giving me the formula A=P(1+r/m)mt

Answer 4

\[10000(1+0.0495\div12)12\]

Answer 5

Same thing, different letters.

Answer 6

ok. SO HOW CAN I FIND THE ANSWER BECAUSE WHAT IM GETTING DOESNT SEEM CORRECT TO WHAT THE EXAMPLE IS SHOWING ME

Answer 7

I pretty much have found the computing formula to find each steps but unable to get verifiable answer

Answer 8

because in the examples they use 15000 and the answer turns out to be $15696.91

Answer 9

\[A=P(1+{r \over m})^{mt}\]\[A=10000(1+{0.0495\over 12})^{12}\]\[A=10000(1.05)\]\[A=10506.4\]
Obviously I've done rounding where I shouldn't have, but that's the procedure.

Answer 10

how did they get that answers from using the formula
because i know for m- i would put 12

Answer 11

What are the values they use in the examples?

Answer 12

they used 15000-p, 0.0455- r, and 12- m

Answer 13

Right so, put those values in in the formula.
\[A=15000(1+{0.0455\over 12})^{12}\]

Answer 14

yes

Answer 15

And you get: 15696.91

Answer 16

yes thats what they got

Answer 17

how did u reach to that?

Answer 18

By working out the above equation.
Lets do it step by step...
Upcoming Ugly numbers!!!
0.0455/12=0.00379166666666666666666666666667
That+1=1.00379166666666666666666666666667
that ^ 12=1.0464609601126369220378253015612
that * 15000=15696.914401689553830567379523418
with some rounding, you get 15696.91.

Answer 19

thank you

Answer 20

let me try it myself and i will let you know

Answer 21

Order of operations.
Brackets
Exponents
Division
Multiplication
Addition
Subtraction

or easily remembering: BEDMAS.

Also, remember ab^k is NOT equal (ab)^k. the difference is that ab^k is a*(b^k) whereas (ab)^k is (a*b) ^ k... there's a different order that you apply the maths in; which result in a different value at the end.

Answer 22

ok

Answer 23

Good luck.

Answer 24

it didnt work the way u did it when i plugged everything myself into the equation
It give me 10,506.39 and i got 2690666.1

Answer 25

Work it out in steps.
0.0495/12=a
1+a=b
b^12=c
P*c=F