Question 663747
1.How much would Php. 10,000,000 amount in 5 years at 16% interest rate and compounded quarterly?
<pre>
A = P(1 + {{{r/n}}})<sup>nt</sup>

A = final amount = ?
P = beginning amount = 10,000,000
r = interest rate expressed as a decimal = 0.16
n = the number of compoundings each year = 4 (quarterly)
t = the number of years = 5

A = 10000000(1 + {{{0.16/4}}})<sup>(4)(5)</sup>
A = 10000000(1 + 0.04)<sup>20</sup>
A = 10000000(1.04)<sup>20</sup>
A = Php 21911231.43

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    </pre>
2. Mr. Cruz deposited money 500 pesos in the bank which earns 5% annual interest compounded annually.How much is his money after 2 years ?
<pre>
A = P(1 + {{{r/n}}})<sup>nt</sup>

A = final amount = ?
P = beginning amount = 500
r = interest rate expressed as a decimal = 0.05
n = the number of compoundings each year = 1 (compounded annually)
t = the number of years = 2

A = 500(1 + {{{0.05/1}}})<sup>(1)(2)</sup>
A = 500(1 + 0.05)<sup>2</sup>
A = 500(1.05)<sup>2</sup>
A = Php 551.25

Edwin</pre>