ECONOMICS
COMPOUND INTEREST
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
$2273.04
|
|
|
$1080.57
|
|
|
$1057.95
|
|
|
$902.18
|
Detailed explanation-1: -For this reason, lenders often like to present interest rates compounded monthly instead of annually. For example, a 6% mortgage interest rate amounts to a monthly 0.5% interest rate. However, after compounding monthly, interest totals 6.17% compounded annually.
Detailed explanation-2: -Solution: We use the present value formula, where A is $20, 000, r is 6% or 0.06, n is 12, and t is 5 years. Approximately $14, 827.45 should be invested today in order to accumulate to $20, 000 in five years.
Detailed explanation-3: -So, The Amount will be Rs. 2163.
Detailed explanation-4: -Poor Credit (300-629): 27-32% Interest Rate. Fair Credit (630-689): 18-22% Interest Rate. Good Credit (690-719): 14-18% Interest Rate. Excellent Credit (720+): 10-14% Interest Rate.