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Financial contracts involving investments, mortgages, loans, and so on are based on either a fixed or a variable interest rate. Assume that fixed Interest rates

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Financial contracts involving investments, mortgages, loans, and so on are based on either a fixed or a variable interest rate. Assume that fixed Interest rates are used throughout this question. Zoe deposited 5900 in a savings account at her bank. Her account will earn an annual simple interest rate of 7%. If she makes no additional dep: or withdrawals, how much money will she have in her account in thirteen years? Now, assume that Zoe's savings institution modifies the terms of her account and agrees to pay 7% in compound interest on her $900 balance. All other things being equal, how much money will Zoe have in her account in thirteen years? Suppose Zoe had deposited another 5900 into a savings account at a second bank at the same time. The second bank also pays a nominal (or stated interest rate of 7% but with quarterly compounding. Keeping everything else constant, how much money will Zoe have in her account at this bank in thirteen years? interest rate of 7% but with quarterly compounding. Keeping everything else constant, how much money will Zoe have in her account at this bank in thirteen years? $163.00 5964,67 52,218.36 5166.16

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