During one year on a $250 deposit paying continuously compounded interest at an APR: Money and Capital Market Assignment, TARC, Malaysia


Tunku Abdul Rahman College (TARC)

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Money and Capital Market Assignment

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4. During one year on a $250 deposit paying continuously compounded interest at an APR of 8%, how much interest can be accumulated?

Interest = principal  rate  term (n)

5. If your trust fund promises to pay you $25,000 on your 24th birthday (6years from today) and earns 9% compounded annually, then what is the trust fund’s present value?

6. If a $10,000 investment will return $25,000 to you in five years, then to the nearest percent what annual interest rate is being offered?

    FV   =PV (1 + r)t

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