Question: Hello i am having trouble solving this problem, Thanks. Suppose at any time, you can transfer all of your money between two accounts. One account

Hello i am having trouble solving this problem, Thanks. Suppose at any time, you can transfer all of your money between two accounts. One account credits simple interest with an annual interest rate of 5%. The other account is an account that is governed by simple discount with an annual discount rate of 4%. You deposit 1000 at time t = 0. What is the maximum amount you can have at t = 3? HINT: In order to maximize the amount of your investment, it will be in your best interest to always have the money in the account that has the higher force of interest.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

The scribes of ancient Egypt were the forerunners of today's accountants. a. True b. False Possible Exam 1 Questions Chapter 1: 3. The scribes of ancient Egypt were the forerunners of today's...

UNIT 5 QZ, Q-20 UNIT 5 / UNIT 8 QUESTIONS KEEP ANSWERS SEPARATE BY UNITS UNIT II STUDY GUIDE Consumer Mathematics Reading Assignment See information below. Key Terms 1. Add-on interest method 2....

PartII. Institutions The great conflict between capitalism and communism is over. Communism has collapsed; capitalism has won. Or so we think. But if you take a closer look at the structure of these...

I am having trouble solving this problem! Need some help please! Juan invests a total of $30,000 in two accounts paying 15% and 10% simple interest, respectively. How much was invested in each...

please help me. I can pay only 70 dollars in this assignment Topic 1 & 2 Introduction to financial management and the Australian Taxation system Financial Markets 2 Learning Objectives Describe what...

please help me in 70 dollars to do this assignment iin APA style referencing Topic 1 & 2 Introduction to financial management and the Australian Taxation system Financial Markets 2 Learning...

I've attached the question as a word file, thanks! JWCL165_c10_444-505.qxd 8/12/09 7:24 AM Page 444 10 Liabilities Chapter STUDY OBJECTIVES After studying this chapter, you should be able to: 1...

PowerPoint Assignment for BUS 401: Principles of Finance You have been asked by a manager in your organization to put together a training program explaining Net Present Value (NPV) and Future Value...

What factors should be considered in deciding whether the cost of capital for a foreign affiliateshould be higher, lower, or the same as the cost of capital for a comparable domestic operation?...

In Florida, real estate agents refer to homes having a swimming pool as pool homes. In this case, Sunshine Pools Inc. markets and installs pools throughout the state of Florida. The company wishes to...

In Section 18-3c, the text explains the special treatment allowed for losses incurred on the sale or worthlessness of stock in a small business corporation under IRC 1244. Individuals A and B are...

11. Open the VB2015\Chap08\Date Solution\Date Solution (Date Solution.sln) file. The interface provides a text box for entering a date. The btnChange_Click procedure should verify that the date was...

A large storage tank, open at the top and filled with water, develops a small hole in its side at a point 16.0 m below the water level. If the rate of flow from the leak is equal to 2.50 X 103m3/min,...

A Styrofoam slab has thickness h and density ps. When a swimmer of mass m is resting on it, the slab floats in fresh water with its top at the same level as the water surface. Find the area of the...

To an order of magnitude, how many helium-filled toy balloons would be required to lift you? Because helium is an irreplaceable resource, develop a theoretical answer rather than an experimental...

A legendary Dutch boy saved Holland by plugging a hole in a dike with his finger, which is 1.20 cm in diameter. If the hole was 2.00m below the surface of the North Sea (density 1 030 kg/m3), (a)...

(a) Show that the function y(x, t) = x2 + v2t2 is a solution to the wave equation. (b) Show that the function in part (a) can be written as f (x # vt) # g(x " vt), and determine the functional forms...

Tori and some other childeen experimented with balls to see which ones rolled. First using a piece of cardboard to use as a ramp, they angled it on a block to the floor to test the balls. Then Tori...

Equipment was purchased on January 2, 2007, for $18,000, but no portion of the cost has been charged to deprecia- tion. The corporation wishes to use the straight-line method for these assets, which...

Indicate the effect-Understate, Overstate, No Effect-that each of the following errors has on 2007 net income and 2008 net income. (a) Wages payable were not recorded at 12/31/07 (b) Equipment...

Robocop Corporation owns stock of Terminator, Inc. Prior to 2008, the investment was accounted for using the equity method. In early 2008, Robocop sold part of its investment in Terminator, and began...