w5 5/12

(Related to Checkpoint5.2)(Compound interest withnon-annual periods) You just received a bonus of $2 comma 000

2,000.

a.Calculate the future value of $2 comma 000

2,000, given that it will be held in the bank for 9

9 years and earn an annual interest rate of 8

8 percent.

b.Recalculate part (a) using a compounding period that is(1) semiannual and(2) bimonthly.

c.Recalculate parts (a) and (b) using an annual interest rate of 16

16 percent.

d.Recalculate part (a) using a time horizon of 18

18 years at an annual interest rate of 8

8 percent.

e.What conclusions can you draw when you compare the answers in parts (c) and (d) with the answers in parts (a) and (b)?

a.What is the future value of $2 comma 000

2,000 in a bank account for 9

9 years at an annual interest rate of 8

8 percent?

$

nothing

(Round to the nearestcent.)