You just received a bonus of $3,000. a. Calculate the future value of $ 3,000, given...

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You just received a bonus of $3,000. a. Calculate the futurevalue of $ 3,000, given that it will be held in the bank for 8years and earn an annual interest rate of 3 percent. b. Recalculatepart (a ) using a compounding period that is (1) semiannual and (2)bimonthly. c. Recalculate parts (a ) and (b ) using an annualinterest rate of 6 percent. d. Recalculate part (a ) using a timehorizon of 16 years at an annual interest rate of 3 percent. e.What conclusions can you draw when you compare the answers in parts(c ) and (d ) with the answers in parts (a ) and (b )?

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a Formula for compound interest A P x 1 rm mt A Future value of investment P Principal 3000 r Rate of interest 3 m No of compounding in a year 1 t No of years 8 A 3000 x 10038 3000 x 1038 3000 x 126677008138762 380031024416285 or 380031 b 1 m No of compounding in a year 2 A 3000 See Answer

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You just received a bonus of $3,000. a. Calculate the futurevalue of $ 3,000, given that it will be held in the bank for 8years and earn an annual interest rate of 3 percent. b. Recalculatepart (a ) using a compounding period that is (1) semiannual and (2)bimonthly. c. Recalculate parts (a ) and (b ) using an annualinterest rate of 6 percent. d. Recalculate part (a ) using a timehorizon of 16 years at an annual interest rate of 3 percent. e.What conclusions can you draw when you compare the answers in parts(c ) and (d ) with the answers in parts (a ) and (b )?