Company B invests $20,000 in a four-year certificate of deposit(CD) that annually pays interest of...
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Finance
Company B invests $20,000 in a four-year certificate of deposit(CD) that annually pays interest of 3.5%.The annual CD interest payments are automatically re-invested in a seperate savings account at a stated annual interest rate of 2% compounded monthly. At maturity , what is the value of the combined asset? Please draw timelines and indicate the cash flows.
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