## 00kirsten 4 years ago Linda invests $5000 into an account that pays 11% compounded quarterly. How much interest will she get after 5 years? • This Question is Closed 1. nowhereman Is her gain reinvested instantly or paid out? 2. 00kirsten i dont no. thats the exact question. i copied n pasted it 3. nowhereman http://en.wikipedia.org/wiki/Compound_interest It is revinvested. That means you have to calculate $5000\cdot 1.11^{4\cdot 5}$ 4. 00kirsten wait how do i write 11% ??? 0.11 or 1.11 ??? ... and i dont no how to do that equation on a calculator 5. BecomeMyFan=D the final answer is 35311.56$

6. BecomeMyFan=D

you do it like this:

7. nowhereman

11% = 0.11 but the original sum remains there too, so you have 1 + 11% = 1.11

8. BecomeMyFan=D

$5000(1+(11/100))^{5*4}$

9. BecomeMyFan=D

got it?

10. 00kirsten

this is how i wrote it .. .A = 5000 (1 = 0.11/4) 4x5

11. BecomeMyFan=D

no, that is wrong

12. 00kirsten

i cant seem to figure that out on a calculator, u told me the answer but i cant get it on the calculator

13. nowhereman

Is it 11% anually or quarterly?

14. 00kirsten

i meant to write 1 + 0.11

15. 00kirsten

quarterely

16. BecomeMyFan=D

ok, the full formula for compound interest is this $A=P(1+rate)^{number of years * timez per year}$ so the timezperyear is 4 in your case as there are 4 quoters in a year

17. nowhereman

Ok, so that /4 was a mistake of yours. Well, what kind of functions does your calculator have? Is there a button that says "a^b" or maybe "x^y" ? Or otherwise there maybe buttons for "exp" and "ln"

18. 00kirsten

umm im doing it on my cellphone calculator so no

19. BecomeMyFan=D

in a calculator it would look like A=P(1+rate)^(numberofyears∗timezperyear)

20. BecomeMyFan=D

damn, you should get a casio fx series

21. nowhereman

you can also do it on google or wolframalpha

22. BecomeMyFan=D
23. BecomeMyFan=D
24. 00kirsten

sooo how do i write down the equation

25. BecomeMyFan=D

it can solve integrals, derivatives, logarithms, anything

26. nowhereman
27. BecomeMyFan=D

like this: A = 5000(1+(11/100))^5∗4

28. BecomeMyFan=D

which is: = 5000(1.11)^20

29. BecomeMyFan=D

which is A = 5000 * 8.062311536 = 40311.55768 so now to get the compound interest subtract the 5000 from the answer, CI=40311.55768-5000 =35311.56

30. 00kirsten

ok thank uu

31. 00kirsten

one more?? Using the rule of 72, how long will it take to double your money if you invest in an account earning 3% interest? Give units of time (days, weeks, months, or years)

32. BecomeMyFan=D

24 years

33. 00kirsten

ok i got it right thx :)

34. BecomeMyFan=D

you just divide 72 by the percentage

35. 00kirsten

wat does it mean tho by give units of time (days,weeks, months, years???

36. BecomeMyFan=D

or, if the question asks you how long it takes for the money to halve, divide 72 by percentage :)

37. BecomeMyFan=D

it is there because the answer is not always in years, for example, if a question asks you how long it takes to double your money if you invest in an account earning 80% interest. It is IMPOSSIBLE in real life, but some questons might ask that, so, 72/80=0.9, which is 0.9 year, which is 365/10*9=328.5=329days

38. BecomeMyFan=D

get it? but most of the times the answer is in years, so dont worry

39. 00kirsten

can you see if these are right for me please. 6. Find the simple interest on $500 for 3 years at 7%. is it like this 500 x 0.07 x 3 =$105 7. Find the simple interest on $800 at 8.75% for 100 days. is it like this$800 x .0875 x 100/365 = $19.18 40. BecomeMyFan=D 6. is right 7. is right 41. 00kirsten sweet thanks and is this one right ... (last one) How much money would you have to invest to make$300 within 2 years if the interest rate was 4.5%? is the answer \$3333.33

42. 00kirsten

i think like 3 diff people gave me different answers, so im so confused!!

43. BecomeMyFan=D

thats right