Question
2. Suppose you decide to deposit $14,000 into a savings account that pays a nominal rate of 15.60%, but interest is compounded daily. Based on
2. Suppose you decide to deposit $14,000 into a savings account that pays a nominal rate of 15.60%, but interest is compounded daily. Based on a 365-day year, how much would you have in your account after four months? (Hint: To calculate the number of days, divide the number of months by 12 and multiply by 365.)
$14,303.99
$14,451.45
$14,746.38
$15,041.31
3. In 1626, Dutchman Peter Minuit purchased Manhattan Island from a local Native American tribe. Historians estimate that the price he paid for the island was about $24 worth of goods, including beads, trinkets, cloth, kettles, and axe heads. Many people find it laughable that Manhattan Island would be sold for $24, but you need to consider the future value (FV) of that price in more current times. If the $24 purchase price could have been invested at a 4.00% annual interest rate, what is its value as of 2017 (391 years later)?
$93,253,648.69
$109,710,174.93
$126,166,701.17
$144,817,430.91
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started