A bank pays a quoted annual (nominal) interest rate of 8. However, it pays interest (compounded) daily using a 365-day year. What is the effective annual rate of return?
A) 7.86
B) 7.54
C) 8.57
D) 8.33
E) 9.21
Question 2
1,200 is received at the beginning of year 1, 2,200 is received at the beginning of year 2, and 3,300 is received at the beginning of year 3. If these cash flows are deposited at 12 percent, their combined future value at the end of year 3 is:
A) 6,700
B) 17,000
C) 12,510
D) 7,504
E) 8,141
China’s 8% annual increase in oil consumption
Example of Reconciling a Bank Statement Cont.
How to calculate simple interest (Part 5; r = I/Pt)
How to calculate compound interest (Part 2)
Total Fertility Rate in the United States, 1860–2008
Jawad makes semi-annual contributions of $2000 starting on his 27th birthday. How much will he ...