Homework Answers
| 1] | Quarterly interest = 6.34%/4 = 1.585% | |
| Number of quarters = 3.5*4 = 14 | ||
| Semi-annual interest = 6.55%/2 = 3.275% | ||
| Number of half years = 4*2 = 8 | ||
| 2] | FV of the investment at the end of 7.5 Years = 13000*1.01585^14*1.03275^8 = | $ 20,966.17 |
| 3] | Interest earned by the investment in 7.5 years = 20966.17-13000 = | $ 7,966.17 |
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