If your lender charges you interest monthly instead of annually, the formulas are the same; you simplytake the rate of interest (8 percent) and divide it by 12to figure out how much interest is charged monthly. Eight percent divided by 12 equals 0.00667, or 0.67 percent. If you have a ...
While it’s fun to try and figure out the quarterly interest, it is also challenging. So, you can convert the quarterly interest rate to annual rates or vice versa using a quarterly interest rate calculator. Plenty of them are available online. But remember that interest paid quarterly is va...
On a certain day, Tim invested $1,000 at 10 percent annual interest, compounded annually, and Lana invested $2,000 at 5 percent annual interest, compounded annually. The total amount of interest earned by Tim's investment in the first 2 years was how much greater than the total amount of...
Answer to: If you deposit $3,800 in an account that earns 8% interest compounded annually, how much will you have in your account in 10 years? By...
A certain investment earned a fixed rate of 4 percent interest per year, compounded annually, for five years. The interest earned for the third year of the investment was how many dollars greater than that for the first year? The amount of the investment at the beginning of the second yea...
Have you ever wondered how to calculate the effective annual rate on a loan or investment? You’re not alone. Many people don’t know that there is an easier way to figure out what your return on an investment will be. It doesn’t involve complicated formulas. ...
You deposit $300 in an account earning 5% interest, compounded annually. How much will you have in the account in 10 years? Future Value: This question relates to the time value of money (TVM), which values a dollar today more than a dollar ...
If you have a credit card that compounds interest daily, it’s going to take you longer to pay off the balance than if it compounded annually or even monthly, all else equal, says Dean. Duration: Aside from how often an account compounds interest, another timing factor is how long your...
If we increase the compound frequency to its limit, we are compounding continuously. While this may not be practical, the continuously compounded interest rate offers marvelously convenient properties.1 It turns out that the continuously compounded interest rate is given by: rcontinuous=ln(1+r)...
cash flow, or expense may be in the future. Future value can also be used to determine risk or to determine how much a given expense will grow if interest is charged, You can use FV to help you understand how much to save