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Thursday, October 22, 2015

Interest

Problem:



Solution:

a)
Monthly growth factor is 1+0.0512=1.004166667
Annual growth rate is (1.004166667)12=1.051161898
Annual Percentage change is 1.0511618981=0.051161898=5.116189788%

b)
Quarterly growth factor is 1+0.0674=1.01675
Annual growth rate is (1.01675)4=1.068702251
Annual Percentage change is 1.0687022511=0.068702251=6.87022514%

c)
Daily growth factor is 1+0.032365=1.0000876712328800
Annual growth rate is (1.0000876712328800)365=1.0325160570374600
Annual Percentage change is 1.03251605703746001=0.0325160570374607=3.2516057037460700%

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