a) FOR $10,000 a retired couple bought a treasury note that paid 4 percent annual interest compunded monthly. they redeemed the note after 21 months. Find the total amount of money they earned on their investment.
b) a $100,000 piece of equipment is depreciating at 10 percent a year
1) how much is it worth after 3 years
2) How much is it worth after 10 years
3) how long will it take to be worth less than $20,000
b) a $100,000 piece of equipment is depreciating at 10 percent a year
1) how much is it worth after 3 years
2) How much is it worth after 10 years
3) how long will it take to be worth less than $20,000
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qa
10000(1+0.04/12)^21 = $ 10723.83 <-------
qb
(i) 100000*0.9^3 = $72,900
(ii) 100000*0.9^10 = 34867.84
(iii) 100000*0.9^n = 20000 , 0.9^n = 0.2 , n = log 0.2 /log 0.9 = 15.28 years
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10000(1+0.04/12)^21 = $ 10723.83 <-------
qb
(i) 100000*0.9^3 = $72,900
(ii) 100000*0.9^10 = 34867.84
(iii) 100000*0.9^n = 20000 , 0.9^n = 0.2 , n = log 0.2 /log 0.9 = 15.28 years
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