44. A:
A = P(1 + r/n)^(n*t)
(A) To have $6,000 in 3 years from now:
A = $6,000
r = 8% = 0.08
n = 4 (compounded quarterly)
t = 3 years
$6,000 = P(1 + 0.08/4)^(4*3)
$4,473.10
44. B:
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Using the same formula:
$6,000 = P(1 + 0.08/4)^(4*6)
$3,864.12
45. A:
A = P * e^(r*t)
(A) To have $25,000 in 36 months from now:
A = $25,000
r = 9% = 0.09
t = 36 months / 12 = 3 years
$25,000 = P * e^(0.09*3)
$19,033.56
45. B:
Using the same formula:
$25,000 = P * e^(0.09*9)
$8,826.11
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46. A:
A = P * e^(r*t)
(A) To have $4,800 in 48 months from now:
A = $4,800
r = 12% = 0.12
t = 48 months / 12 = 4 years
$4,800 = P * e^(0.12*4)
$2,737.42
46. B:
Using the same formula:
$4,800 = P * e^(0.12*7)
$1,914.47
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47. A:
For an investment at an annual rate of 3.9% compounded monthly:
The periodic interest rate (r) is the annual interest rate (3.9%) divided by the number of compounding periods per year (12 months):
r = 3.9% / 12 = 0.325%
APY = (1 + r)^n - 1
r is the periodic interest rate (0.325% in decimal form)
n is the number of compounding periods per year (12)
APY = (1 + 0.00325)^12 - 1
4.003%
47. B:
The periodic interest rate (r) is the annual interest rate (2.3%) divided by the number of compounding periods per year (4 quarters):
r = 2.3% / 4 = 0.575%
Using the same APY formula:
APY = (1 + 0.00575)^4 - 1
2.329%
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48. A.
The periodic interest rate (r) is the annual interest rate (4.32%) divided by the number of compounding periods per year (12 months):
r = 4.32% / 12 = 0.36%
Again using APY like above:
APY = (1 + (r/n))^n - 1
APY = (1 + 0.0036)^12 - 1
4.4037%
48. B:
The periodic interest rate (r) is the annual interest rate (4.31%) divided by the number of compounding periods per year (365 days):
r = 4.31% / 365 = 0.0118%
APY = (1 + 0.000118)^365 - 1
4.4061%
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49. A:
The periodic interest rate (r) is equal to the annual interest rate (5.15%):
r = 5.15%
Using APY yet again:
APY = (1 + 0.0515/1)^1 - 1
5.26%
49. B:
The periodic interest rate (r) is the annual interest rate (5.20%) divided by the number of compounding periods per year (2 semiannual periods):
r = 5.20% / 2 = 2.60%
Again:
APY = (1 + 0.026/2)^2 - 1
5.31%
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50. A:
AHHHH So many APY questions :(, here we go again...
The periodic interest rate (r) is the annual interest rate (3.05%) divided by the number of compounding periods per year (4 quarterly periods):
r = 3.05% / 4 = 0.7625%
APY = (1 + 0.007625/4)^4 - 1
3.08%
50. B:
The periodic interest rate (r) is equal to the annual interest rate (2.95%):
r = 2.95%
APY = (1 + 0.0295/1)^1 - 1
2.98%
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51.
We use the formula from while ago...
A = P(1 + r/n)^(nt)
P = $4,000
A = $9,000
r = 7% = 0.07 (annual interest rate)
n = 12 (compounded monthly)
$9,000 = $4,000(1 + 0.07/12)^(12t)
7.49 years
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52.
Same formula...
A = P(1 + r/n)^(nt)
$7,000 = $5,000(1 + 0.06/4)^(4t)
5.28 years
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53.
Using the formula:
A = P * e^(rt)
A is the final amount
P is the initial principal (investment)
r is the annual interest rate (expressed as a decimal)
t is the time in years
e is the base of the natural logarithm
P = $6,000
A = $8,600
r = 9.6% = 0.096 (annual interest rate)
$8,600 = $6,000 * e^(0.096t)
4.989 years
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Hope this helps.