Question
1.Suppose you decide to deposit $21,000 in a savings account that pays a nommal rate of 16%, but interest is compounded daily. Based on a
1.Suppose you decide to deposit $21,000 in a savings account that pays a nommal rate of 16%, but interest is compounded daily. Based on a 365-day year, how much would you have in the account after 12 months?
$24,642.86
$26,121.43
$23,903.57
$25,135.72
2. A local bank's advertising reads: "Give us $35,000 today, and well pay you $600 every year forever." If you plan to live forever, what annual Interest rate will you earn on your deposit?
1.71%
2.74%
1.37%
2.05%
3. Oops! When you went in to make your deposit, the bank representative said the amount of required deposit reported in the advertisement was incorrect and should have read $52,500. This revision, which will reduce the interest rate earned on your deposited funds, will adjust your earned interest rate to.
1.20%
1.14%
1.08%
0.97%
Step by Step Solution
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