Margaret Hillman invested $7,000 at 1.8% compounded quarterly for one year. Find the future value and the interest earned for the year. The future value is S. (Round to the nearest cent as needed.)
Margaret Hillman invested $7,000 at 1.8% compounded quarterly for one year. Find the future value and the interest earned for the year. The future value is S. (Round to the nearest cent as needed.)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA3: Time Value Of Money
Section: Chapter Questions
Problem 3CE
Related questions
Question
Expert Solution
Step 1
GIVEN THAT,
Amount invested (P) = $7000
compounding = 4times a year = 1/4
rate of interest = 1.8%
= (1.8 / 100) * 1/4
rate of interest (i) = 0.0045
n = 1 years * number of compounding periods
n = 1 * 4times a year
n = 4
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning