Question
A student has $3,000 saved up to take a vacation in 5 years time. She doesnt want to take a big risk so a commercial
A student has $3,000 saved up to take a vacation in 5 years’ time. She doesn’t want to take a big risk so a commercial bank gives her the following option to choose from:
A. Non-compounding rate of 9.8%
B. Compounding rate of 8.2% annual compounding
D. Compounding rate of 8% compounded quarterly.
Given that she needs the highest future value you would choose:
Option 1
Option 2
Option 3
Insufficient information given
Step by Step Solution
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There are 3 Steps involved in it
Step: 1
Given PV 3000 Option 1 Non compounding rate of 98 N 5 years R 0098 ...
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Step: 2
Step: 3
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Business Statistics Communicating With Numbers
Authors: Sanjiv Jaggia
3rd Edition
1259957616, 978-1259957611
