Question

Compare the investment below to an investment of the same principal at the same rate compounded annually. ​

Answer 1

9514 1404 393

Answer:

  compounding 6 times per year earns $458.36 more interest over 20 years

Step-by-step explanation:

We can compute the value of the investment for the different compounding schemes. The applicable formula is ...

  A = P(1 +r/n)^(nt)

where P is the principal, r is the annual rate, n is the number of interest periods per year, and t is the number of years.

Compounded 6 times per year:

  A = $3000(1 +.07/6)^(6·20) ≈ $12,067.41

Compounded 1 time per year:

  A = $3000(1.07)^20 ≈ $11,609.05

Answer 2

Answer:

Can you please describe the problem more detailed pls?