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Assume Jennifer has owned an EE bond for 4 years. The fixed rate of interest is 10% and the current value of the bond is $4000. If Jennifer were to cash in the bond tomorrow, how much interest will she
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Assume Jennifer has owned an EE bond for 4 years. The fixed rate of interest is 10% and the current value of the bond is $4000. If Jennifer were to cash in the bond tomorrow, how much interest will she lose (approximately) as a penalty

User Dmx
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1 Answer

1 vote

Answer:

400

Step-by-step explanation:

Given:

Face Value of the bond = $4000

The fixed rate of interest is r = 10%

If f Jennifer were not to cash in the bond tomorrow, it means she have the value of $4000 after 4 years. But tomorrow she were to cash, so the interest she lose is:

I = FV*r = 4000*10% = 400

User Jay Querido
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