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?
2 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.
1 answer