00:01
Hello everyone, in this question we are given with the principal amount that is $20 ,000 p is equal to 7 years, r is equal to 5 percentage which is the rate of interest, this can be written as 0 .05.
00:24
So here in this question we have to find the interest earned annually.
00:33
So for that let us use the formula which is a is equal to p into 1 plus r divided by n power nt.
00:46
So since we have to find the interest for annually we can take n is equal to 1.
00:54
So here the a value will be equal to 20 ,000 into 1 plus 0 .05 divided by 1 the whole power n into t that is 1 into 7.
01:09
Now simplifying this we will get 20 ,000 into 1 .05 the whole power 7.
01:19
So to find the interest earned we can use the formula a minus p.
01:28
So actually we have a is equal to 20 ,000 into 1 .05 the whole power 7 minus and p value that is the principal value 20 ,000.
01:45
Now evaluating this we will get the interest rate is approximately equal to $7830 .28 which is the answer for the first part.
02:03
Next we have to find the answer that is the interest rate for semi -annually.
02:11
So here we can take n is equal to 2 using the same formula which we used above we can take a is equal to 20 ,000 in the place of n we will put 2.
02:24
So 1 plus 0 .05 divided by 2 the whole power 2 into 7.
02:30
So a will be equal to 20 ,000 into 1 .025 the whole power 14.
02:39
Now to find the value of interest let us use the formula a is equal to a minus p that will be equal to 20 ,000 into 1 .025 the whole power 14 minus 20 ,000.
02:54
So evaluating this we will get the value of i will be approximately equal to $8073 .34.
03:08
Next we have to find the amount of interest earned when compounded quarterly.
03:14
So here we can take n is equal to 4 using the same formula we can calculate a is equal to 20 ,000 into 1 plus 0 .05 divided by 4 the whole power 4 into 7...