On September 3, 2008 you invested $1,000 at the annual risk-free
rate of 7% until APR....
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Finance
On September 3, 2008 you invested $1,000 at the annual risk-freerate of 7% until APR. 18, 2009. Calculate the amount you willreceive on APR 18, 2009 if the annual 5% rate is compounded;
annually
quarterly
monthly
daily
continuously.
Answer & Explanation
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Amount Invested
1000
Date of Investment
03-09-2008
Date untill
18-04-2009
Interest Rate
5%
No of Days investment is held
228
No of Days in a year
365
T
0.625
=228/365
Value of 'e'
2.71828
1)
Annual Compounding
Maturity Amount
=$C$2*((1+$C$5)^$C$8)
1031
2)
Quarerly Compounding
Maturity Amount
=$C$2*((1+$C$5/4)^($C$8*4))
1031.52602
3)
Monthly Compounding
Maturity Amount
=$C$2*(1+$C$5/12)^($C$8*12)
1031.658796
4)
Daily Compounding
Maturity Amount
=$C$2*((1+$C$5/365)^($C$8*365))
1031.723534
5)
Continuous comoiunding
Maturity Amount
=$C$2*$C$9^($C$5*$C$8)
1031.725719
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