APR would be 8.69%
Please refer to below spreadsheet for calculations
Formula reference-
Suppose that you have $100,000 in cash today. You want to find a bank account that...
Is this correct Suppose that you have $100,000 in cash today. You want to find a bank account that offers an interest rate that will allow you to make withdrawals to pay your monthly expenses of $1,250, beginning one month from today, for 10 years before exhausting the account. Assume that any savings account we consider pays interest monthly (i.e monthly compounding). What APR must the account offer in order for you to achieve your goal? .7.45% 8.69% 9:16% 110.43%
Suppose that you have $50,000 in cash today. You want to find a bank account that offers an interest rate that will allow you to make withdrawals to pay your monthly expenses of $1,000, beginning one month from today, for 5 years before exhausting the account. Assume that any savings account we consider pays interest monthly (i.e., monthly compounding). What APR must the account offer in order for you to achieve your goal? C) 7.42% 47.33% 10.44% 5.00% 8.37%
You will be asked to find the simple interest for an account. You have $10,000 in a savings account that pays 2% simple interest per year. Find the interest earned for the first year. Find the balance on an account that accrues compound interest . Given an investment, APR, compounding rate and length of investment find the balance after maturity. You have $10,000 in a savings account that pays 2% APR compounded monthly. Find the balance on the account after...
Three years ago, you made a deposit in a savings account with a 4% APR. The bank pays interest monthly with no compounding. Today you have $1680 in the bank. What was your original deposit?
1. My credit card charges interest of 0.04% per day compounded daily. (a) What is the APR for this credit card? (b) What is the APY? Assume 360 days in a year (twelve 30-day months). 2. A local credit union is advertising a car loan with an APR of 6.75%. If interest is compounded monthly, (a) what is the interest rate per compounding period, and (b) what is the effective annual interest rate (i.e., the APY)? 3. Your local credit...
Your best friend consults you for investment advice. You learn that his tax rate is 38%, and he has the following current investments and debts:• A car loan with an outstanding balance of $5,000 and a 4.79 APR (monthly compounding)• Credit cards with an outstanding balance of $10,000 and a 14.94%APR (monthly compounding)• A regular savings account with a $30,000 balance, paying a 5.44% effective annual rate (EAR)• A money market savings account with a $100,000 balance, paying a 5.25% APR (daily compounding)• A tax-deductible home...
A financial institution offers a "double-your-money" savings account in which you will have $2 in 6 years for every dollar you invest today. What stated annual interest rate (assuming semi-annual compounding) does this account offer? Please specify your answer in decimal terms and round your answer to the nearest thousandth (e.g., enter 12.3 percent as 0.123).
Show the excel formulas used Ex. 1 You have $5,000 in your savings account that pays 4% interest. How much will you have in your account after 20 years, a) if your bank pays annually compounded interest? b) if your bank pays monthly compounded interest? c) if your bank pays daily compounded interest? Current balance Interest Years Compounding Annually Monthly Daily a) FV b) FV c) FV Ex. 2 If you need $10,000 in 7 years and you can earn...
Future 0.23 Suppose that you deposit $1,000 into a savings account that pays 8 percent. a If the bank compounds interest annually, how much will you have in your account in four years? b. What would your balance be in four years if the bank used quarterly com- pounding rather than annual compounding? C. Suppose you deposited the $1,000 in four payments of $250 each year beginning one year from now. How much would you have in your account after...
(how to enter it in BA2 plus calculator) I have $72,000 in my bank account today. The bank manager told me that I will have $100,000 money in five years if I keep the money in this account and don’t touch it (meaning that I won’t withdraw from it or don’t add more into it). The account pays me daily interest. What is the APR for my account?