Homework Help: Finance

Posted by Kelly on Sunday, November 6, 2011 at 2:28pm.

You deposit $1000 in an account that pays 8% interest compounded semiannually. After 2 years, the interest rate is increased to 8.40% compounded quarterly. What will be the value of the account after 4 years?

Finance - Henry, Monday, November 7, 2011 at 8:18pm
Pt = Po(1+r)^n.

r = Rate per compounding.
n = The # of compounding periods.

2 yrs @ 8% + 2 yrs @ 8.4%.

Pt = !000(1.04)^4 + Po2(1.021)^8,
Pt = 1169.8586 + 1169.8586(1.021)^8,
Pt = 1169.8586 + 1381.4631 = $2551.32.

Answer this Question

Related Questions

FINANCE - You deposit $2,000 in an account that pays 8% interest compounded ...
Math - If you deposit $900 semiannually in a bank which pays 6% interest ...
Alg 2 - Suppose you deposit a principal amount of p dollars in a bank account ...
Alg2 - Help....Help... Suppose you deposit a principal amount of p dollars in a ...
Economics - Finance - If your bank pays 5.5 percent interest on savings deposits...
Finance - You deposit $1000 for 5 years at 4% annual interest. In 5 years, you ...
Math - You deposit $1000 in an account at the Lifelong Trust Savings and Loan ...
Compound math - (Future Value) Suppose you invest $8000 into an account that ...
math - A deposit of $2,000 earns interest at a rate of 14% compounded quarterly...
value of money - A deposit of $2,000 earns interest at a rate of 14% compounded ...

For Further Reading

First Name:
School Subject:
Answer: