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April 1, 2015

April 1, 2015

Posted by **Alicia** on Monday, January 17, 2011 at 6:26pm.

n = 12 x 5 = 60

R = 100

I = 0.06/12 = 0.005

I know the answer is:

n = 12 x 5 = 60

R = 100

I = 0.06/12 = 0.005

= 100 ([1.005]^60 - 1)/.005

= 6977.00

But I have to draw a line diagram and I keep getting the following answers... I don't understand what i'm doing wrong. Can somebody please explain to me?

Time

(Years) Amount of money at the beginning of the year Interest for the year New amount of money by the end of the year

1 n/a n/a 1200$

2 1200$ 1200[0.6][12] = 86.40 1286.40$

3 1286.40$ 1286.40[0.6][12] = 92.62 1379.02$

4 1379.02$ 1379.02[0.6][12] = 99.29 1478.31$

5 1478.31$ 1478.31[0.6][12] = 106.44 1584.75$

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