2023 1 First City Bank pays 6 percent simple interest on its savings account balances whereas Second City Bank pays | Assignments Online

 

1. First City Bank pays 6 percent simple interest on its savings account balances, whereas Second City Bank pays 6 percent interest compounded annually.

If you made a $60,000 deposit in each bank, how much more money would you earn from your Second City Bank account at the end of 10 years? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

 Difference in accounts __$?

2. For each of the following, compute the future value (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)):

Present Value Years Interest Rate Future Value 

   $1,950  10    14  %   $___?___

   $8,152    8      8%   $___?___

   $70,355  15    13%             $___?___

   $177,796    6      5%             $___?___

3. For each of the following, compute the present value (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)):

Present Value Years Interest Rate Future Value 

   $_____  12      6  %   $14,751

   $_____    3     12%   $44,557

   $_____  28     13%             $879,073

   $_____  30     10 %             $543,164

4. Solve for the unknown interest rate in each of the following (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)):

Present Value Years Interest Rate Future Value 

   $170  3     __ %   $196

   $290  17     __%   $732

   $32,000  18     __%             $124,723

   $31,261  20     __ %             $226,140