Michael wants to save $46,000.00 for a down payment on a home. How much will he need to invest in an account with 6.1% APR, comp

Question

tangare [24]

3 years ago

9

Michael wants to save $46,000.00 for a down payment on a home. How much will he need to invest in an account with 6.1% APR, comp

ounding daily, in order to reach his goal in 7 years? Round the answer to the nearest cent

Mathematics

2 answers:

lisabon 2012 [21] · Answer 1 · 2022-08-31T04:38:03+03:00

lisabon 2012 [21]3 years ago

8 0

Answer:

i.d.k

Step-by-step explanation:

sorry

peace

...

really sorry my friend

Rufina [12.5K] · Answer 2 · 2022-08-31T02:48:51+03:00

Step-by-step explanation:

Simple Interest

Discussing interest starts with the principal, or amount your account starts with. This could be a starting investment, or the starting amount of a loan. Interest, in its most simple form, is calculated as a percent of the principal. For example, if you borrowed $100 from a friend and agree to repay it with 5% interest, then the amount of interest you would pay would just be 5% of 100: $100(0.05) = $5. The total amount you would repay would be $105, the original principal plus the interest.

four rolled-up dollar bills seeming to grow out of dirt, with a miniature rake lying in between them

SIMPLE ONE-TIME INTEREST

I

=

P

0

r

A

=

P

0

+

I

=

P

0

+

P

0

r

=

P

0

(

1

+

r

)

I is the interest

A is the end amount: principal plus interest

P

0

is the principal (starting amount)

r is the interest rate (in decimal form. Example: 5% = 0.05)

EXAMPLES

A friend asks to borrow $300 and agrees to repay it in 30 days with 3% interest. How much interest will you earn?

Show Solution

The following video works through this example in detail.

One-time simple interest is only common for extremely short-term loans. For longer term loans, it is common for interest to be paid on a daily, monthly, quarterly, or annual basis. In that case, interest would be earned regularly.

For example, bonds are essentially a loan made to the bond issuer (a company or government) by you, the bond holder. In return for the loan, the issuer agrees to pay interest, often annually. Bonds have a maturity date, at which time the issuer pays back the original bond value.

EXERCISES

Suppose your city is building a new park, and issues bonds to raise the money to build it. You obtain a $1,000 bond that pays 5% interest annually that matures in 5 years. How much interest will you earn?

Show Solution

Further explanation about solving this example can be seen here.