Which expression is equivalent to 100? O 10 O 102 O 50 O 502
2 answers:
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<u>Answer:</u>
The present value of 10,000 if interest is paid at a rate of 6.2% compounded weekly for 8 years is 6097.56
<u>Explanation:</u>
We know that compound interest is given by
Where ,
Where A = final amount (which is given to be = 10000)
P = Principal amount (which is the present amount which we have to find)
r = interest rate = 6.2 = 0.062
n = no. of times interest applied per time period = it is given that the interest is applied weekly, so in one year there are 52 weeks so n = 52
t = time period = 8 years
Substituting the given values, we get
P = 6097.5
We get, P = 6097.56 which is the present value of a sum of money