3.  Problem 4-31 (Nonannual Compounding)
Nonannual Compounding
It is now January 1. You plan to make a total...
50.1K
Verified Solution
Link Copied!
Question
Finance
3.  Problem 4-31 (Nonannual Compounding)
Nonannual Compounding
It is now January 1. You plan to make a total of 5 deposits of$400 each, one every 6 months, with the first payment being madetoday. The bank pays a nominal interest rate of 8% butuses semiannual compounding. You plan to leave the moneyin the bank for 10 years. Do not round intermediate calculations.Round your answers to the nearest cent.
How much will be in your account after 10 years?
$__________________Â Â
You must make a payment of $1,924.06 in 10 years. To get themoney for this payment, you will make five equal deposits,beginning today and for the following 4 quarters, in a bank thatpays a nominal interest rate of 8% with quarterlycompounding. How large must each of the five payments be?
$__________________Â Â
Answer & Explanation
Solved by verified expert
3.6 Ratings (609 Votes)
a EAR 1 stated rateno of compounding periods no of compounding periods 1 100 18210021100 Effective Annual Rate 816 FVAnnuity Due c1 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: Zin AI - Your personal assistant for all your inquiries!
