Answer:
Step-by-step explanation:
A. The formula for determining simple interest is expressed as
I = PRT/100
Where
I represents interest paid on the amount of money deposited.
P represents the principal or amount of money deposited.
R represents interest rate on the deposit.
T represents the duration of the deposit in years.
From the information given,
P = $6000
R = 5%
T = 10 years
Therefore,
I = (6000 × 5 × 10)/100
I = $3000
Total amount = 6000 + 3000 = $9000
B. We would apply the formula for determining compound interest which is expressed as
A = P(1 + r/n)^nt
Where
A = total amount in the account at the end of t years
r represents the interest rate.
n represents the periodic interval at which it was compounded.
P represents the principal or initial amount deposited
From the information given,
P = 6000
r = 4.9% = 4.9/100 = 0.049
n = 12 because it was compounded 12 times in a year.
t = 10 years
Therefore,
A = 6000(1 + 0.049/12)^12 × 10
A = 6000(1 + 0.049/12)^120
A = $9780
C. The formula for continuously compounded interest is
A = P x e^(r x t)
Where
A represents the future value of the investment after t years.
P represents the present value or initial amount invested
r represents the interest rate
t represents the time in years for which the investment was made.
r = 4.8% = 4.8/100 = 0.048
Therefore,
A = 6000 x e^(0.048 x 10)
A = 6000 x e^(0.48)
A = $9696
