Business and social sciences compound interest homework...

Name: business and social sciences compound interest homework question 7 512 part 1 of 2 find the compound amount and the amount of interest earned by the deposit below 4000 at 361 compounded cont 85202
Uploaded: 2023-06-30T03:09:21-08:00
Duration: 4 min 47 s
Channel: Madhur L
Description: business and social sciences compound interest homework question 7 512 part 1 of 2 find the compound amount and the amount of interest earned by the deposit below 4000 at 361 compounded cont 85202

Business and Social Sciences Compound Interest Homework Question 7, 5.1.2 Part 1 of 2 Find the compound amount and the amount of interest earned by the deposit below. $4,000 at 3.61% compounded continuously for 5 years. What is the compound amount? $ (Do not round until the final answer. Then round to the nearest cent.)

Transcript

00:01 Hi here for the given question.

00:02 We need to calculate what is the value that we got after investing amount at a compound interest of formula to calculate the compound interest is p multiplied with 1 plus r upon n to the power n t and here we know that the interest can be calculated as amount minus principle.

00:19 So here in our case for the first part, we are given that the value of principle p is equal to $14 ,000 further the rate of interest which are is equal to 5 percentage and it is compounded monthly.

00:34 So here the number of time period t is equal to 19 and here the month n will be equal to 12 as it is compounded monthly.

00:45 So substituting the value in the above formula, we have $14 ,000 multiplied with 1 plus 0 .05 upon 19 to the power 12 multiplied with 19.

00:54 So here on simplifying this value, we have compound interest a is equal to 27 ,872 .22.

01:02 So this is the value of the amount after 19 years and here we can calculate the value of interest.

01:09 I is equal to $14 ,000 minus plus 27 ,872 .22.

01:16 So calculating this difference we can say that interest i is equal to 13 ,872 .22.

01:23 So this is the solution of the first part.

01:26 Now similarly, we need to calculate for the second part.

01:29 Here for the second part we are given that here in our case we have value of principle interest p is equal to $7 ,700 and the value of rate of interest r is equal to 0 .09.

01:42 It is 9 percentage and here value of period n is equal to 4 as it is compounded quarterly and time period t is equal to 8.

01:50 So here in our case amount a is equal to 7700 multiplied with 1 plus 0 .09 to the power divided by 4 to the power 4 multiplied with 8.

02:00 So calculating this value we have amount a is equal to $14 ,827 .17 and further subtracting the principle from amount we can say that interest i is equal to 14 ,827 .17 minus 7700.

02:19 So simplifying this we have interest i is equal to 14 ,000 here by subtracting these two value we can say that the value of interest earned i is equal to $7 ,127 .17.

02:37 So this is the solution of the second part...

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