document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=273688>Question 273688</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Find the future value on a savings account with a principle of $4700 at 4% simple interest for time period of 4 years. \r<BR>\n" );
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document.write( "Find the future value on a savings account at the end of 6 years if the initial balance is $4400 and the accounts earns 3% interest compounded semiannually. \r<BR>\n" );
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document.write( "Steve has a loan out for $15600. The interest rate on his loan is 4% compounded quarterly. Find the annual percent yield for Steves loan. \r<BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #199920 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=199920\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> First problem:\r<BR>\n" );
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document.write( "Future Value of the account 4 years from now would be:\r<BR>\n" );
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document.write( "4700 + (.04*4700) * 4 = 5452\r<BR>\n" );
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document.write( "This is simple interest (no compounding).\r<BR>\n" );
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document.write( "you take the interest for 1 year and multiply that by 4 to get the total interest and then you add it to the principal.\r<BR>\n" );
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document.write( "Second problem:\r<BR>\n" );
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document.write( "Future Value of the account 6 years from now would be:\r<BR>\n" );
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document.write( "4400 * (1.015)^12 = 5260.719954\r<BR>\n" );
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document.write( "3% interest per year compounded semi-annually is equal to 1.5% interest per semi-annual time period.\r<BR>\n" );
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document.write( "The number of time periods are the number of years times the number of compounding periods per year.\r<BR>\n" );
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document.write( "6 * 2 = 12 time periods.\r<BR>\n" );
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document.write( "your interest per time period is 3% / 2 equals 1.5% divided by 100% equals .015.<BR>\n" );
document.write( "your number of time periods is number of years * number of time periods per year equals 6 * 2 = 12.\r<BR>\n" );
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document.write( "That's why the formula is as shown.\r<BR>\n" );
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document.write( "problem number 3:\r<BR>\n" );
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document.write( "loan is for 154600<BR>\n" );
document.write( "interest rate is 4% compounded quarterly.<BR>\n" );
document.write( "find the annual percent  yield for steve's loan.\r<BR>\n" );
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document.write( "I think this is what they are talking about:\r<BR>\n" );
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document.write( "<a  rel=nofollow HREF= \"http://www.investopedia.com/articles/basics/04/102904.asp\" target = \"_blank\">http://www.investopedia.com/articles/basics/04/102904.asp</a>\r<BR>\n" );
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document.write( "4% per year compounded quarterly yields an effective rate calculated as follows:\r<BR>\n" );
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document.write( "4% / 4 = 1% per quarter.\r<BR>\n" );
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document.write( "There are 4 quarters to the year.\r<BR>\n" );
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document.write( "1.01^4 = 1.04060401\r<BR>\n" );
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document.write( "The annual percentage rate is 4%.<BR>\n" );
document.write( "The annual percentage yield is 4.060401%.\r<BR>\n" );
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document.write( "you take ten thousand dollars for 1 year at 4% per year and you have 10,400 at the end of the year.\r<BR>\n" );
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document.write( "you take ten thousand dollars for 1 year at 1% compounded quarterly and you have 10,406 at the end of the year.\r<BR>\n" );
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document.write( "not a big difference with 4% but there is a difference.\r<BR>\n" );
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document.write( "with steve, the loan is 15,600\r<BR>\n" );
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document.write( "at the annual percent rate, the interest figures out to be 624.\r<BR>\n" );
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document.write( "at the effective yield rate, the interest figures out to be 633.422556\r<BR>\n" );
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document.write( "not sure if I answered the last question correctly.\r<BR>\n" );
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document.write( "let me know if you need more.\r<BR>\n" );
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