Question: ASAP!! Note: Account A pays simple interest. Future Value A= Principal + Interest = Principal +[( Principal Interest Rate ) Investment Period ] =$2,000+[($2,0006%)3 years
Note: Account A pays simple interest. Future Value A= Principal + Interest = Principal +[( Principal Interest Rate ) Investment Period ] =$2,000+[($2,0006%)3 years ] =5 Future Value of Account X Note: Account X pays compound interest. Future Valuex = Present Value x Interest Rate Factor = Present Value (1+InterestRate)N =$2,000(1+0.06)3 =5 To find the interest rate factor, you can use four different ways, including multiplying it out: Interest Factor (1+0.06)(1+0.06)(1+0.06)=1.1910 you can use exponents, and calculate it directly: Interest Factor =(1+0.06)3=1.1910 The third alternative for solving the equations is to use a spreadsheet, and the fourth is to let a financial calculator perform the calculation. This requires that you know how your calculator functions and how to enter the following variables
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
