document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=116745>Question 116745</A>: <I><SPAN STYLE=\"word-break: break-all;\">  Please Help me with this word problem. This is my last assignment and I am stuck on this, so if you can help I really apreciate it. Thank you\r<BR>\n" );
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document.write( "The formula for calculation the amount of money retuened for an initial deposit into a bank account or CD is given by  A=P(1+r/n)<BR>\n" );
document.write( "A is the amount of return<BR>\n" );
document.write( "P is the principal of intitial deposit<BR>\n" );
document.write( "r is annual interest rate(expressed as a decimal)<BR>\n" );
document.write( "n is the number of compound periods in one year<BR>\n" );
document.write( "t is the number of years\r<BR>\n" );
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document.write( "carry all calculations to six decimals on each intermediate step round final number to nearest cent.\r<BR>\n" );
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document.write( "Suppose you deposit $4000 for 8years at a rate of 7%\r<BR>\n" );
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document.write( "A) calculate the return(A) if the bank compounds annually(n=1) round to hundredth place\r<BR>\n" );
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document.write( "B)calculate the return(A) if the bank compounds monthly (n=12) round to nearest hundredth place\r<BR>\n" );
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document.write( "C) Does compounding annually or monthly yeild more interest? explain why\r<BR>\n" );
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document.write( "D)If a bank compounds continuously then the formula used is A=Pe^n where e is a constant and equals approximately 2.7183 <BR>\n" );
document.write( " Calculate A with continuous compounding. round to nearest hundredth place\r<BR>\n" );
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document.write( "E) How long will it take to double my money at 7% interest rate and continuous compounding. round to the nearest Hundredth place\r<BR>\n" );
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document.write( "SHOW ALL WORK FOR A-E QUESTIONS  THANK YOU AGAIN IN ADVANCE  </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #84944 by </B><A HREF=/tutors/aboutme.mpl?userid=stanbon><B>stanbon(75887)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=stanbon><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/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=84944\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Suppose you deposit $4000 for 8years at a rate of 7% <BR>\n" );
document.write( "A) calculate the return(A) if the bank compounds annually(n=1) round to hundredth place <BR>\n" );
document.write( "A(t) = P(1+r/n)^(nt)<BR>\n" );
document.write( "A(8) = 4000(1+0.07/1)^(1*8 =$6872.75<BR>\n" );
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document.write( "B)calculate the return(A) if the bank compounds monthly (n=12) round to nearest hundredth place <BR>\n" );
document.write( "A(8)= 4000(1+(0.07/12))^(12*8)<BR>\n" );
document.write( "A(8)= 4000(1.0058)^(96)= $6969.10<BR>\n" );
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document.write( "C) Does compounding annually or monthly yeild more interest? explain why<BR>\n" );
document.write( "monthly because, although you compound at a smaller rate, compounding <BR>\n" );
document.write( "more ofterm more than offsets the difference.<BR>\n" );
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document.write( "D)If a bank compounds continuously then the formula used is A(t)=Pe^rt where e is a constant and equals approximately 2.7183 <BR>\n" );
document.write( "Calculate A with continuous compounding. round to nearest hundredth place<BR>\n" );
document.write( "A(8) = 4000e^(0.07*8)<BR>\n" );
document.write( "A(8) = 4000*1.7507<BR>\n" );
document.write( "A(8) = $7002.69<BR>\n" );
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document.write( "E) How long will it take to double my money at 7% interest rate and continuous compounding. round to the nearest Hundredth place <BR>\n" );
document.write( "8000 = 4000e^(0.07t)<BR>\n" );
document.write( "2 = e^(0.07t)<BR>\n" );
document.write( "0.07t = ln2<BR>\n" );
document.write( "t = (ln2)/(0.07)<BR>\n" );
document.write( "t = 9.90 years<BR>\n" );
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document.write( "Cheers,<BR>\n" );
document.write( "Stan H.<BR>\n" );
document.write( " </SPAN>\n" );
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