MATH 1100 Louisiana State University Investment and Annual Yield Mathematics Ques

1. Find the accumulated value of an investment of $15,000 for 7 years at an interest rate of 5.5% if the money is a. compounded semiannually; b. compounded quarterly; c. compounded monthly d. compounded continuously. Round answers to the nearest cent.

2. How much money should be deposited today in an account that earns 8% compounded semiannually so that it will accumulate to $10,000 in three years?

3. How much money should be deposited today in an account that earns 4.5% compounded monthly so that it will accumulate to $13,000 in three years?

4. A passbook savings account has a rate of 10%. Find the effective annual yield, rounded to the nearest tenth of a percent, if the interest is compounded semiannually.

5. A passbook savings account has a rate of 8%. Find the effective annual yield if the interest is compounded quarterly.

6. Determine the effective annual yield for each investment. Then select the better investment.  Assume 360 days in a year. 5.5% compounded semiannually; 5.4% compounded daily