You deposit $2,000 in ABC Bank that pays 6% interest compounded annually: What will be the Amount

Fantastic news! We've Found the answer you've been seeking!

Question:

You deposit $2,000 in ABC Bank that pays 6% interest compounded annually:

What will be the Amount in your bank account at the end of 2 years?

You find out that PQR Bank also pays 6% interest but compounded quarterly. So, you withdraw money from ABC Bank at the end of 1 year and transfer the amount to PQR Bank. How much money will you have in PQR Bank at the end of 1 year?

What is the difference between the Interest earned at the 2 banks in 1 year?

Related Book For answer-question

Principles of Finance

ISBN: 978-1285429649

6th edition

Authors: Scott Besley, Eugene F. Brigham

See More Books

Posted Date: Jun 27, 2023 12:39 AM

See More Questions

Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
Assume for simplicity that these payments continue for 20 years and then cease. The interest rate is 4% . You plan to cover this obligation by investing in 5- and20-year maturity Treasury strips.(a)...
1. Suppose someone offered you your choice of two equally risky annuities, each paying $5,000 per year for 5 years. One is an annuity due, while the other is a regular (or deferred) annuity. If you...
Write a BST client that uses the data file ip-tocountry.csv found on the booksite to determine the source country of a given IP address. The data file has five fields: beginning of IP address range,...
Delevan Corp. uses a periodic inventory system and is counting its year-end inventory. Due to a lack of communication, two different teams count the same section of the warehouse. What effect will...
What is the normal resting state of the SET and RESET inputs? What is the active state of each input?
How many forms of main() are there?
John Gemstone, a wealthy client, has recently been audited by the IRS. The agent has questioned the following deduction items on Mr. Gemstones tax return for the year under review: A $10,000 loss...
6. Even though the Kraus representation gives an "internal" view of the dynamics of the open system Q, the Kraus operators contain some information about the environment. Concretely, let & be an...
On January 1, 2010, Innovus, Inc., acquired 100 percent of the common stock of ChipTech Company for $670,000 in cash and other fair-value consideration. ChipTechs fair value was allocated among its...
Calculate the annual percentage cost of not taking advantage of a cash discount if a supplier provides payment terms of 3%/5, net 40 cash discount.
How is the holding period determined for property acquired by a gift and from a decedent?
Contrast the tax treatment of a shareholder in a redemption under Code Sec. 302 with a shareholder's tax treatment in a liquidation under Code Sec. 331.
What special rules apply to prepaid interest?
Give the acceptable reasons to accumulate earnings as specified in the Code.
What are the interests in, and powers over, property that may be given to a donee without estate tax consequences to the donee's estate?
Exercise. Which of the following sequences are geometric sequences for n = 1, 2, 3, ...? an = -3n+ 5 an = - an = an = -5.714 an 5" 22+1 (3) -an-1 4nn-14 n+2 where a1 10 = an = n cos(2n) + 4 . an =...
A red card is illuminated by red light. What color will the card appear? What if its illuminated by blue light?
Tanner Technologies Corporation (TTC) has been growing at a rate of 20 percent per year in recent years. This same growth rate is expected to last for another two years. a. If D0 = $1.60, rs = 10%,...
Yesterday Sanjay sold 1,000 shares of stock that he owned for $45 per share. When he purchased the stock two years ago, Sanjay paid $50 per share. Every three months during the time that he held the...
What is the difference between stock price maximization and profit maximization? What conditions might promote profit maximization but not lead to stock price maximization?
At January 1, 2015, Cheng Company reported retained earnings of 20,000,000. In 2015, Cheng discovered that 2014 depreciation expense was understated by 4,000,000. In 2015, net income was 9,000,000...
Cherokee Construction Company changed from the cost-recovery to the percentage-of-completion method of accounting for long-term construction contracts during 2015. For tax purposes, the company...
In 2015, Bailey Corporation discovered that equipment purchased on January 1, 2013, for 50,000 was expensed at that time. The equipment should have been depreciated over 5 years, with no residual...

You deposit $2,000 in ABC Bank that pays 6% interest compounded annually: What will be the Amount

Question:

Expert Answer:

To calculate the amount in your ABC Bank account at the end of 2 years we can use the formula for co... View the full answer

Principles of Finance

Students also viewed these finance questions