For each of the following investments, calculate:
Neil invested \$3500 at 4.3\% p.a. compounded daily.
Buzz invested \$2610 at 2.7\% p.a. compounded quarterly.
Christa invested \$7630 at 2.3\% p.a. compounded semiannually.
For each of the following scenarios, find the effective rate correct to two decimal places:
A loan attracts interest at a rate of 6.7\% compounded monthly.
A loan attracts interest at a rate of 1.8\% compounded annually.
An investment earns interest at a rate of 9.1\% compounded quarterly.
An investment earns interest at a rate of 7.2\% compounded semiannually.
An investment earns interest at a rate of 4.3\% compounded daily.
A loan of \$3200 has earned interest of \$768 after the first year. Find the effective interest rate on this loan.
A loan is known to have the same effective interest rate as an investment offering 11\% compounded semi-annually. If this loan is actually compounded quarterly, find the nominal rate, r, correct to two decimal places.
State the better option to choose for an investment:
1.6\% compounded monthly
1.5\% compounded daily
State the better option to choose for a loan:
1.9\% compounded semi-annually
1.8\% compounded quarterly
Consider the following investment options:
Option 1 : 4.75\% compounded annually
Option 2: 4.67\% compounded monthly
Consider the following investment options:
3.5\% compounded quarterly
3.5\% compounded monthly
Consider the following loan options:
2.5\% compounded quarterly
2.7\% compounded monthly
Two different lending institutions are offering different rates on their loans.
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Betta Bank is offering 4.4\% compounded monthly.
Lucky Lending is offering 4.2\% compounded quarterly.
Find the effective rate of Betta Bank correct to two decimal places.
Find the effective rate of Lucky Lending correct to two decimal places.
State the lending institution that has the better offer.
The Bank of Hilo offers two investment opportunities for investors:
Option 1: 6.86\% p.a. simple interest for 10 years.
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Option 2: 6.76\% p.a. compound interest for 6 years, compounded semiannually.
On an investment of \$1000, find the interest earned for the following options:
Option 1
Option 2
Find the effective annual interest rate for Option 2. Round your answer to two decimal places.
State the investment opportunity that has the larger effective annual interest rate.
Maximilian has \$1800 to put into savings for 4 years. His bank offers two different savings options for this period of time:
Option 1. Simple interest at a rate of 2.48\% p.a.
Option 2. Compound interest at a rate of 2.4\% p.a., compounded monthly.
Calculate the interest Maximilian would earn from the following options:
Option 1
Option 2
State the option Maximilian should choose to invest his money.
Calculate the extra interest Maximilian will earn by choosing the option with the higher return.