SOLUTION: $24,000 is deposited for 5 years in an account earning 7% interest. (Round your answers to two decimal places.) (a) Calculate the interest earned if interest is compounded semiann

Algebra ->  Finance -> SOLUTION: $24,000 is deposited for 5 years in an account earning 7% interest. (Round your answers to two decimal places.) (a) Calculate the interest earned if interest is compounded semiann      Log On


   

Question 1134095: $24,000 is deposited for 5 years in an account earning 7% interest. (Round your answers to two decimal places.)
(a) Calculate the interest earned if interest is compounded semiannually.
$

(b) Calculate the interest earned if interest is compounded quarterly.
$
(c) How much more interest is earned on the account when the interest is compounded quarterly?
$

Answer by Boreal(15235) About Me  (Show Source):
You can put this solution on YOUR website!
P=Po(1+(r/n))^nt for semiannually
=24000(1.035)^10
=$33854.37, round at end

for quarterly
=24000(1.0175)^20
=$33954.68, a little higher, as it should be
$100.31 more