SOLUTION: Gabriel invested $53,300 in a mutual fund at 3.4% compounded quarterly. After 4 years, the interest rate was changed to 6.4% compounded monthly.
a) How much was the value of the
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a) How much was the value of the
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Question 1192860: Gabriel invested $53,300 in a mutual fund at 3.4% compounded quarterly. After 4 years, the interest rate was changed to 6.4% compounded monthly.
a) How much was the value of the fund 8 years after the rate change? $
b) How much was the total compound interest earned during the whole term? Found 2 solutions by greenestamps, ikleyn:Answer by greenestamps(13200) (Show Source):
The solution by other tutor is not quite accurate.
I came to bring a correct solution.
Starting value:
After 4 years at 3.4% compounded quarterly:
After the additional 8 years at 6.4% compounded monthly the final value is
= 101697.33 dollars. ANSWER to question (a)
The interest earned is the final value minus the original $53,300, i.e.
101697.33 - 53000 = 48697.33. ANSWER to question (b)
