i’m not really sure how to do th is problem
Bank A offers an
interest rate of 5.5% per annum compounded annually on deposits of more than $10,000. An investor wants to deposit $25,000.
(i) What would her balance be after 3 years? (my answer: 67448.3)
(ii) How long will she need to wait until the balance is twice the initial deposit? (my answer:6.58 years)
Before making her deposit of $25,000, the investor explored offers from other banks and found two other investment strategies. Bank B offers continuously compounded interest at the rate of 5.3% per annum, and bank C offers an interest rate of 5.4% per annum compounded quarterly.
(i) If the investor chooses Bank B, how much would her balance be after 3 years? (my answer: 29308.45)
(ii) If the investor chooses Bank C, how much would her balance be after 3 years? (my answer:76017.06)
thank you so much 🙂
Balance after 3 years.
iis Future value should be GOOOD in in years .
500 0 0
– 2500 0 (1 + 0. 05 5 ) 7
= gt; ( 1055)n
– 5030 0
from tical and eveor method