Your grandmother has been asked to invest in a product that offers to double her money in 3 years. Indicate the annual rate of return she is being offered. (4 marks)

(b) Your parents have $5,000.00 to deposit. Alpha Bank offers 2 percent per year compounded monthly. Bravo Bank offers 2 percent compounded annually. Compute the amount of deposit after being kept 10 years at each bank. Explain the difference between the two (2) future values.

(c) Your best friend is saving $1,800.00 and will earn 0.17 percent per month. Determine the number of months until the account grows to $2,000.00. (4 marks)

(d) Your cousin plans to expand his business and will require $100,000.00 in 6.5 years. The rate of return will be 0.70 percent per month for the first two years. It will go up to 1.00 percent for the rest of the period. Compute the $ amount to set aside today to reach her objective.

Answer rating: 100% (QA)

a To double the money in 3 years the annual rate of return being offered is approximately 2449 calculated using the formula for compound interest 2 11 ... View the full answer