Project 2

Project 2

Published on 2 November 2021
Transcript
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Collaboration Exercise #2
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Question 1
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What is the compound amount of P35,000 invested at 24% interest compounded monthly for 15 months?
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Given
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P= 35,000 j= 0.24 or 24% t= 15 months (1.3) m= 12
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n=tm n=1.3x12 n=15.6
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i= j/m i=0.24/12 i=0.02
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Required: F = ?
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Solution
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F = P(1+i)ⁿ F = 35,000(1+0.02) F = P47,668.42
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15.6
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   Answer: The compound amount of P35,000 invested at 24% interest compounded monthly for 15 months is P47,668.42.
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Question 5 What is the effective rate equivalent to a nominal rate of 5% compounded semi-annually?
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Given:
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j = 0.05 or 5%                    i=j/m m = 2                                     i=0.05/2                                               i=0.025 Required: w = ? 
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Solution:
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w=(1 + j/m) -1 w=(1+0.05/2)² -1 w= 0.0506 or 5.06%
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m
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Answer: The effective rate of 5.06% is equivalent to a nominal rate of 5% compounded semi-annually.
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Thank  you!
01:16
Aryanna Dela Cruz
01:16
Kurt Provido
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