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8) You obtain a $1000 treasure note with a 6% annual rate, paid semi-annually, with a maturity in 5 years. How much interest will you
8) You obtain a $1000 treasure note with a 6% annual rate, paid semi-annually, with a maturity in 5 years. How much interest will you earn?
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To calculate the interest earned on a 1000 treasure note with a 6 annual rate paid semiannually over a 5year maturity we can use the formula for compound interest A P 1 rnnt Where A is the final amount including interest P is the principal amount initial investment r is the annual interest rate as a decimal n is the number of compounding periods per year t is the time in years In this case the principal amount is 1000 the annual interest rate is 6 or 006 as a decimal the compounding is semiannual ...
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Basic Finance An Introduction to Financial Institutions Investments and Management
Authors: Herbert B. Mayo
10th edition
1111820635, 978-1111820633
