Ask Experts Questions for FREE Help !
Ask
    Algebra8's Avatar
    Algebra8 Posts: 5, Reputation: 1
    New Member
    		  
    #1

    Jan 29, 2012, 07:55 AM
    Finance Question
    Find the ending balance in an account that opens with $3,000, earns 4.5% interest compounded quarterly, and is held for 20 years. (Round your answer to the nearest cent.) I used A=P(1 ti)N = 3,000(1 o.01125) = 4693.13. (which is wrong. Please show me how you arrived with your answer. I have a deadline to meet to meet today before 5p. Sorry
    ArcSine's Avatar
    ArcSine Posts: 969, Reputation: 106
    Senior Member
    		  
    #2

    Jan 30, 2012, 04:40 AM
    You were on the right track, but you compounded for only 40 periods. Quarterly compounding and 20 years = 80 periods as the exponent, not 40.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Finance Question [ 2 Answers ]

Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. If the corporate tax rate is 35 percent, what is the aftertax cost of Ying's debt? (Do not include the percent sign (%). Round your answer to 2 decimal places....

Finance Question. [ 1 Answers ]

A corporation has $5,000,000 of 10 percent bonds and $3,000,000 of 12 percent Preferred stock outstanding. The firm's financial breakeven (assuming a 40 percent tax rate) is A) $860,000 b) $716,000 C) $1,400,000 D)$1,100,000 Please I need CORRECT answer ASAP. Thx

Finance question [ 0 Answers ]

What is the price of an 8% annual coupon bond, with a £1,000 face value, which matures in 6 years? Assume a required return of 4%. How would the price of the bond change if coupon payments were made quarterly (i.e. every three months)?

Finance question here too [ 0 Answers ]

Which of the following statements regarding calculating a firm's cost of capital is correct ? Answer a. if a company's beta increases, this will increase the cost of equity financing b. since retained earnings are readily available, the cost of retained earnings is generally lower than...

Finance question. [ 2 Answers ]

You want to have $34,000 in your savings account 12 years from now. You're prepared to make equal annual deposits in the account at the end of each year. If the account pays 7% interest, what amount must you deposit each year?

View more questions Search