What is the monthly interest rate

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Reference no: EM131952657

Simple and Compound Interest Assignment

1-4. Find the simple interest to the nearest cent.

1. $350 at 7.5% for 3 years

2. $700 at 18% for 6 months

3. Sander invested $155 at 10% simple interest. What is the total amount of money after 2 years?

4. Brandon borrowed $875 at 5% simple interest for 5 years. What is the total amount he must repay?

5-8. Find the balance of the account earning compound interest annually.

5. $7000 at 2% for 4 years.

6. $7000 at 4% for 2 years.

7. Mark deposits $2000 into an account that pays an interest rate of 3.5% compounded annually. He doesn't add or remove money from his account for 4 years. How much money will Mark have in 4 years?

8. You deposit $1500 into an account that pays an interest rate of 4% compounded annually. Your friend deposits $1500 into an account that pays a simple annual interest rate of 4%. Compare the balances of the two accounts after 5 years.

Having a credit card is like having a loan. The credit card company lends you money on a monthly period. If your monthly bill is not paid in full, you are charged interest on the unpaid balance and interest on any interest you may already own. Credit card companies use a compound interest formula. They do not compound interest annually, they compound interest much more frequently (e.g., daily).

9. Let's say that you have a credit card with XYZ Credit Card Company and XYZ charges an 18% annual interest rate on unpaid balances compounded monthly. Although most people usually make at least minimum payments and others pay their balances in full, in this case assume no payments were made.

a. What is the monthly interest rate?

b. $1,234 was charged to the credit card. What is the balance on the card after:

i. One month?
ii. Six months?
iii. One year?

Remember, you originally spent $1,234 dollars on goods and services you wanted. However, if you don't pay off the balance at the end of the month you will pay much more.

Attachment:- Case-Studies.rar

Reference no: EM131952657

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