A $4000 certificate of deposit is purchased for$4000 and is held for eleven years. If the certificate earns an effective rate of 7%, what is it worth at the end of that period?

Find the price a purchaser should be willing to pay for the given bond. Assume that the coupon interest is paid twice a year.

$25,000 bond with coupon rate 7% that matures in 10 years; current interest rate is 6%.

A sum of $1000 was invested for 4 years, and the interest was compounded semiannually. If this sum amounted to$1435.77 in the given time, what was the interest rate?

Suppose you deposit m dollars at the beginning of every month in a savings account that earns a monthly interest rate of r, which is the annual interest rate divided by 12 (for example, if the annual interest rate is 2.4%, r=0.024/12=0.002). For an initial investment of m dollars, the amount of money in your account at the beginning of the second month is the sum of your second deposit and your initial deposit plus interest, or m+n(1+r). Continuing in this fashion, it can be shown that the amount of money in your account after n months is $A_{n}=m+m(1+r)+\cdots+m(1+r)^{n-1}$. Use geometric sums to determine the amount of money in your savings account after 5 years (60 months) using the given monthly deposit and interest rate. Monthly deposits of $250 at a monthly interest rate of 0.2%

The interest rate on a car loan affects the monthly payment. The function that relates the monthly payment for a 5 -year loan (60-month loan) to the monthly interest rate is given by

$$P(x)=\frac{C x}{\left[1-\frac{1}{(x+1)^{60}}\right]}$$

where $x$ is the monthly interest rate (as a decimal), $C$ is the loan amount, and $P(x)$ is the monthly payment.

Simplify the complex fraction.

Find the price a purchaser should be willing to pay for the given bond. Assume that the coupon interest is paid twice a year.

$15,000 bond with coupon rate 6% that matures in 4 years; current interest rate is 5%.

At bank A, $600 is invested with an interest rate of 5% compounded annually. At bank B,$500 is invested with an interest rate of 6% compounded quarterly. Which account will have a larger balance after 10 years? 20 years

To make CDs look more attractive than they really are, some banks advertise that their rates are higher than their competitors’ rates; however, the fine print says that the rate is a simple interest rate. If a person deposits $10,000 at 10% per year simple interest, what compound interest rate would yield the same amount of money in 3 years?

Suppose an amount P is invested at an interest rate r and A is the amount after t years.

(a) Write an expression for $A$ if the interest is compounded $n$ times per year.

(b) Write an expression for $A$ if the interest is compounded continuously.

Suppose an amount P is invested at an interest rate r and A is the amount after t years.

(a) Write an expression for A if the interest is compounded n times per year.

(b) Write an expression for A if the interest is compounded continuously.

The monthly payment that amortizes a loan of A dollars in t years when the interest rate is r/year compounded monthly, is given by $P=f(A, r, t)=\frac{A r}{12\left[1-\left(1+\frac{r}{12}\right)^{-12 t}\right]}$ a. What is the monthly payment for a home mortgage of $300,000 that will be amortized over 30 years with an interest rate of 4%/year? An interest rate of 6%/year? b. Find the monthly payment for a home mortgage of$300,000 that will be amortized over 20 years with an interest rate of 6%/year.

The monthly payment on a $300,000 30 year mortgage at 6% annual interest rate is$1798.65. What is the interest payment for the first month?

All rates of interest given here are annual rates. Calculate the rate of interest per year which will earn the given amount of interest: a) Principal $400 time 4 years interest$112, b) Principal $800 time 7 years interest$224

Bill Rich signed a 180-day note for $1,250. He repaid the loan when due with interest at an annual rate of 12 % using a banker's year.

Tony Colito paid$19.50 in interest on a loan of $2,600 for 1 month. What rate of interest did he pay?