1. An investor deposits $400 into a bank account that earns an annual interest rate of...

80.2K

Verified Solution

Question

Finance

1. An investor deposits $400 into a bank account that earns anannual interest rate of 8%. Based on this information, how muchinterest will he earn during the second year alone? (choose a orb)
a. 32 b. 34.56
2. A monthly interest rate of 1% is a compounded annual rateof:
a. 12.5 b. 12.68
3. Suppose that a family wants to save money for a child'scollege tuition. The child will be attending college in 12 years.The cost of college education today is $120,000. If the interestrate is 6% and the inflation rate is 2%, then about how much doesthis family need to deposit in their savings account today?
a. 75633Â Â b. 74420
4. Sharon deposits $150.00 in her savings account at the bank.At the end of one year she has $156.38. What was the interest ratethat Sharon earned?
a. 4.3 b. 4.25

Answer & Explanation Solved by verified expert

4.2 Ratings (832 Votes)

1 Amount deposited today 400 1st year interest on 400 400 8 32 Therefore account balance for year 2 interest calculation 400 32 432 Hence 2nd year interest will be at 8 on 432 4328 3456 So the correct answer in See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member