document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1200464>Question 1200464</A>: <I><SPAN STYLE=\"word-break: break-all;\"> You deposit $10,000  in an account that pays 5.5% interest compounded quarterly.<BR>\n" );
document.write( "A.  Find the future value after one year.<BR>\n" );
document.write( "B.  Use the future value formula for simple interest to determine the effective annual yield. </SPAN>\n" );
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document.write( "A. 5.5% (annual interest) compounded quarterly means (5.5)/4 = 1.375% each quarter.  The value of an initial deposit of $10,000 at that rate for 1 year (4 quarters) is<br><BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=10000%281.01375%29%5E4%29 ALIGN=MIDDLE  ALT=\"10000%281.01375%29%5E4%29\"   DISABLED_style= \"max-width:90%; height:auto;\" > = 10561.45<br><BR>\n" );
document.write( "ANSWER: $10561.45<br><BR>\n" );
document.write( "B. The growth factor over the year is<br><BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=10561.45%2F10000=1.056145 ALIGN=MIDDLE  ALT=\"10561.45%2F10000=1.056145\"   DISABLED_style= \"max-width:90%; height:auto;\" ><br><BR>\n" );
document.write( "so the effective simple (annual) interest rate is 5.6145%<br><BR>\n" );
document.write( "ANSWER: 5.6145%<br><BR>\n" );
document.write( " </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );