Solve the following word problem by using Table 11-1.
The rate of bacteria growth in a laboratory experiment was measured at 17% per hour. If this experiment is repeated and begins with 5 grams of bacteria, how much bacteria should be expected after 12 hours? Round to the nearest tenth of a gram.
Click here for Table 11-1
Do not enter units in your answer.
grams
Solve the following word problem by using Table 11-2.
Pinnacle Homes, a real estate development company, is planning to build five homes, each costing $145,000, in 3 years. The Galaxy Bank pays 8% interest compounded semiannually. How much should the company invest now to have sufficient funds to build the homes in the future? Round your answer to the nearest cent.
Click here for Table 11-2
$
Miguel wants to have $17,000 in 10 years. Use the present value formula to calculate how much Miguel should invest now at 8% interest, compounded semiannually in order to achieve his goal.
Homework Answers
1. Given,
Beginning measure: 5 grams, Rate of growth per period (hour)=17% and time horizon=12 hours.
Future Value Factor for 12 periods at 17%= 6.58007
Weight of bacteria expected after 12 hours= Beginning value*Future Value Factor= 5*6.58007 = 32.9
2. Given,
Cost of each home= $145,000. Therefore, total amount required for 5 homes (A) = $145,000*5= $725,000
Time horizon: 3 years, compounded semiannually. Therefore, number of compounding periods (n)= 3*2 = 6
Rate of interest per year= 8%. Therefore, rate per period (r)= 8%/2 = 4%
Present Value Factor (PVF) for 6 periods @4% interest= 0.79031
Amount to be invested now is the present value (PV) of future sum required, computed as follows:
PV= F* Present Value Factor
Substituting the given values, amount to be invested now= $725,000*0.79031 = $572,974.75
3. Present Value is calculated using the following formula:
PV= FV/(1+r)^n Where PV= Present Value, FV= Future Value, r= Rate of interest per period and n= number of times compounded.
Given,
Future Value required (FV)= $17,000
Period= 10 Years. Compounding frequency= Semi annual. Hence number of times compounded a year=2 and total number times of compounding (n) =10*2 = 20
Rate of interest=8%. Therefore, rate of interest per compounding period (r)= 8%/2 =4% or, 0.04
Substituting these values in the formula,
Amount to be invested now (PV)= $17,000/(1+0.04)^20 = $17,000/2.191123= $7,758.58
Add Answer to:
Solve the following word problem by using Table 11-1.
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Solve the following problems using either Tables 11-1 or 11-2
from your text. When necessary, create new table factors. (Round
new table factors to five decimal places, round dollars to the
nearest cent and percents to the nearest hundredth of a
percent)
Refer to Narrative 11-1. Calculate the compound
interest on an investment of $18,000 at 8%, interest compounded
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Group of answer choices
$1,873.44
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$883.54
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Solve the following problems using either Tables 11-1 or 11-2 from your text. When necessary, create...
Solve the following problems using either Tables
11-1 or 11-2 from your text. When necessary, create new table
factors. (Round new table factors to five decimal places, round
dollars to the nearest cent and percents to the nearest hundredth
of a percent)
Refer to Narrative 11-1. Simon invests $19,500, at 9%
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For each of the following cases, indicate (a) to what rate
columns, and (b) to what number of periods you would refer in
looking up the interest factor.
1. In a future value of 1 table:
Annual Rate
Number of Years Invested
Compounded
(a) Rate of Interest
(b) Number of Periods
a.
11%
11
Annually
%
b.
12%
8
Quarterly
%
c.
12%
16
Semiannually
%
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Annual...
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factors. (Round new table factors to five decimal places, round
dollars to the nearest cent and percents to the nearest hundredth
of a percent)
a.Refer to Narrative 11-1. Omar invests $3,000 at 12%
interest, compounded semiannually for 2 years. Calculate the
effective interest rate for his investment. (Round to nearest
hundredth percent)
b.Solve the following problems using either Tables
11-1 or 11-2...
Solve the following problems using either Tables
11-1 or 11-2 from your text. When necessary, create new table
factors. (Round new table factors to five decimal places, round
dollars to the nearest cent and percents to the nearest hundredth
of a percent)
a.Refer to Narrative 11-1. Calculate the compound
interest on an investment of $45,000 at 6% interest, compounded
quarterly, for 3 years.
b.Refer to Narrative 11-1. You wish to have $17,000 in
11 years. Find how much you should...
Solve the following problems using either Tables
11-1 or 11-2 from your text. When necessary, create new table
factors. (Round new table factors to five decimal places, round
dollars to the nearest cent and percents to the
nearest hundredth of a percent)
Refer to Narrative 11-1. George invests $12,500, at
12% interest, semiannually for 12 years. Calculate the compound
amount for his investment.
Table 11-1: Compound Interest Table (Future Value of $1 at Compound Interest) (1 of 2) CENGAGE Table...
Narrative 11-1
Solve the following problems using either Tables 11-1 or 11-2
from your text. When necessary, create new table factors. (Round
new table factors to five decimal places, round dollars to the
nearest cent and percents to the nearest hundredth of a
percent)
Refer to Narrative 11-1. Calculate the compound
interest on an investment of $18,000 at 8%, interest compounded
quarterly, for 15 months.
Group of answer choices
$1,873.44
$18,788.21
$883.54
$8,725.35
Table 11-1: Compound Interest Table (Future Value...
Solve the following problems using either Tables
11-1 or 11-2 from your text. When necessary, create new table
factors. (Round new table factors to five decimal places, round
dollars to the nearest cent and percents to the nearest hundredth
of a percent)
Refer to Narrative 11-1. Simon invests $19,500, at 9%
interest, compounded annually for 11 years. Calculate the compound
amount for his investment.
Group of answer choices
$41,578.53
$59,622.88
$40,793.88
$50,318.39
9:19 2.ma 31% Table 11-1: Compound Interest Table...
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For each of the following cases, indicate (a) to what rate
columns, and (b) to what number of periods you would refer in
looking up the interest factor.
1. In a future value of 1 table:
Annual Rate
Number of Years Invested
Compounded
(a) Rate of Interest
(b) Number of Periods
a.
11%
11
Annually
%
b.
12%
8
Quarterly
%
c.
12%
16
Semiannually
%
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