Anthony and Michelle Constantino got married and received $20,000 in cash for their wedding How they have on their 25th anniversary they place half of money in a rate 7 percent compounded annually? Would the value be larger or smaller if the compounding period was 6 months? How much more or less would they have earned this shorter compounding period?

1) If they place half of this money, PV in a fixed rate investment earning 7 percent compounded annually, the amount they will have, FV, on their 25th anniversary is?

2) Would the future value be larger or smaller if the compounding period was 6 months? Select the best choice

a) Smaller. The greater the number of compounding periods per year, the smaller the impact of compound interest, all else equal.

b) Larger. The greater the number of compounding periods per year, the larger the impact of compound interest, all else equal.

c) Equal. The number of compounding periods per year does not influence the future value.

3) The additional amount they would have earned with this shorter compunding period is? $

corpowinding penod? Cack os bie tatien icos to vere fre PVif tabie Frinet be terenest (net) The addtond amount fey eoud have earned win thes therter conpound geved s: (Round to the natert rent)