FormulasIn the provided formulas, A is the balance in the account after t years, P is theprincipal investment, r is the annual interest rate in decimal form, n is the numberof compounding periods per year, and Y is the investment's effective annual yieldin decimal form.A=P² Y= (1+) -1A=PntP = - The principal represents an amount of money deposited in asavings account subject to compound interest at the given rate.Click the icon to view some finance formulas.A. Find how much money there will be in the account after the given number of years.B. Find the interest earned.A. The amount of money in the account after 2 years is $.(Round to the nearest hundredth as needed.)Principal$7000B. The amount of interest earned is $(Round to the nearest hundredth as needed.)Rate7%CompoundedquarterlyTime2 years

The amount of interest earned depends on the compouding and more is the interest accumulated when…

In the provided formulas, A is the balance in the account after t years, P is principal investment, r is the annual interest rate in decimal form, n is the n of compounding periods per year, and Y is the investment's effective annua in decimal form.

In the provided formulas, A is the balance in the account after t years, P is principal investment, r is the annual interest rate in decimal form, n is the n of compounding periods per year, and Y is the investment's effective annua in decimal form.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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Question

Formulas
In the provided formulas, A is the balance in the account after t years, P is the
principal investment, r is the annual interest rate in decimal form, n is the number
of compounding periods per year, and Y is the investment's effective annual yield
in decimal form.
A=P² Y= (1+) -1
A=P
nt
P = -

The principal represents an amount of money deposited in a
savings account subject to compound interest at the given rate.
Click the icon to view some finance formulas.
A. Find how much money there will be in the account after the given number of years.
B. Find the interest earned.
A. The amount of money in the account after 2 years is $.
(Round to the nearest hundredth as needed.)
Principal
$7000
B. The amount of interest earned is $
(Round to the nearest hundredth as needed.)
Rate
7%
Compounded
quarterly
Time
2 years

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