Suppose you invest $1000 in an account paying 8% interest per year. a. What is the balance

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Suppose you invest $1000 in an account paying 8% interest per year.

a. What is the balance in the account after three years? How much of this balance corresponds to “interest on interest”?

b. What is the balance in the account after 25 years? How much of this balance corresponds to interest on interest?

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Corporate Finance

ISBN: 9780137845071

6th Edition

Authors: Jonathan Berk, Peter DeMarzo

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