Question

$5,900 is invested today in 2-month term deposit that has an interest rate of 2.4% p.a. At the end of the 2 months, the maturity value of the first term deposit is re-invested into a 1-month term deposit at an interest rate of 3.1% p.a. What is the maturity value at the end of the second term deposit?

Name: 5900 is invested today in 2 month term deposit that has an interest rate of 24 pa at the end of the 2 months the maturity value of the first term deposit is re invested into a 1 month term d 99009
Uploaded: 2023-06-22T22:12:33-08:00
Duration: 1 min 25 s
Channel: Penny Riley
Description: 5900 is invested today in 2 month term deposit that has an interest rate of 24 pa at the end of the 2 months the maturity value of the first term deposit is re invested into a 1 month term d 99009

          $5,900 is invested today in 2-month term deposit that has an
interest rate of 2.4% p.a. At the end of the 2 months, the maturity
value of the first term deposit is re-invested into a 1-month term
deposit at an interest rate of 3.1% p.a. What is the maturity value
at the end of the second term deposit?

Added by David R.

Calculus: Early Transcendentals

James Stewart 8th Edition

Instant Answer

Solved by Expert Penny Riley

06/22/2023

Step 1

In this case, the Principal is $5,900, the Rate is 2.4% p.a., and the Time is 2/12 years (since it is a 2-month term deposit). Therefore, the interest earned on the first term deposit is: Interest = $5,900 x 2.4% x (2/12) = $23.60 So, the maturity value of the Show more…

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$5,900 is invested today in 2-month term deposit that has an interest rate of 2.4% p.a. At the end of the 2 months, the maturity value of the first term deposit is re-invested into a 1-month term deposit at an interest rate of 3.1% p.a. What is the maturity value at the end of the second term deposit?