Question 384340: Hi! I have a couple of questions on compound interest from my HW assignment that I am not able to answer. I would appreciate some help. Thanks!
1. How much compound interest is earned by investing $80,000 at 9% p.a., if the investment is over a 3 year period?
2. What will an investment of $45,000 amount to after 21 months if it earns 7.5% p.a. compounded quarterly?
3. What initial investment is required to produce a maturing amount of $40,000 in 8 years time if your money can be invested at 9% p.a. compounded monthly?
4. The animal in Eraticus is endangered. Since 1985 there has only been one colony remaining and in 1985 the population of the colony was 555. Since then the population has been steadily decreasing at 4.5% per year. Find:
a. the population in the year 2000
b. the year in which we would expect the population to have declined to 50.
Once again, I appreciate all the help. The answers to these do not match mine so I would love a step by step procedure for this so I know exactly what I did wrong. Thank you!
Answer by rfer(16322)   (Show Source):
You can put this solution on YOUR website! 1)
A=80000(1+0.09)^3
A=80000*1.295
A=103600
103600-80000=$23,600
2)
A=45000(1+0.075/4)^4*2/24*21
A=45000(1.01875)^8*21/24
A=45000(1.01875)^7
A=45000*1.1388679
A=51249.06
3)
40000=P(1+0.09/12)^8*12
P=40000/(1+.0075)^96
P=40000/2.048921
P=19522.18
|
|
|
