The following certificate of deposit (CD) was released from a particular bank. Find the compound amount and the amount of interest earned by the following deposit. $2500 at 5% compounded daily for 8 years. What is the compound amount? $ (Round to the nearest cent.) What is the interest earned? $ (Round to the nearest cent.)

College Algebra
7th Edition
ISBN:9781305115545
Author:James Stewart, Lothar Redlin, Saleem Watson
Publisher:James Stewart, Lothar Redlin, Saleem Watson
Chapter8: Sequences And Series
Section8.4: Mathematics Of Finance
Problem 26E
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The following certificate of deposit (CD) was released from a particular bank. Find the compound amount and the
amount of interest earned by the following deposit.
$2500 at 5% compounded daily for 8 years.
What is the compound amount?
(Round to the nearest cent.)
What is the interest earned?
(Round to the nearest cent.)
Transcribed Image Text:The following certificate of deposit (CD) was released from a particular bank. Find the compound amount and the amount of interest earned by the following deposit. $2500 at 5% compounded daily for 8 years. What is the compound amount? (Round to the nearest cent.) What is the interest earned? (Round to the nearest cent.)
Expert Solution
Step 1

given  initial amount is $ 2500rate=5%compound daily for 8 years formula for compound daily is A=P(1+rn)nt A is future value P is initial amount r is rate n=365t=time in years 

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