Question
Question8: Using the Present Value Table on page 358 of your text to compute the present value (principal) for an investment with a compound amount of $20,000, a 30 moth term of investment, and a 14% nominal interest rate compound semiannually.
Question 9. What is the compound interest on the previous investment?
Question 9. What is the compound interest on the previous investment?
Answers
the amount of money
14% nominal rate compounded semi-annually for 30 months
---> i = .07 , n= 5 half-years
PV = 20000(1.07)^-5
= $14259.72
I am surprised that you are still using "tables" in the back of textbooks.
A modern calculator is so much more practical, and for critics of calculators, what is the difference between looking up a number in a book or punching keys on a calculator. In both cases "somebody or something" has done all the work for you anyway.
---> i = .07 , n= 5 half-years
PV = 20000(1.07)^-5
= $14259.72
I am surprised that you are still using "tables" in the back of textbooks.
A modern calculator is so much more practical, and for critics of calculators, what is the difference between looking up a number in a book or punching keys on a calculator. In both cases "somebody or something" has done all the work for you anyway.