Linda invests $5000 into an account that pays 11% compounded quarterly. How much interest will she get after 5 years?

- anonymous

- chestercat

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- nowhereman

Is her gain reinvested instantly or paid out?

- anonymous

i dont no. thats the exact question. i copied n pasted it

- nowhereman

http://en.wikipedia.org/wiki/Compound_interest
It is revinvested. That means you have to calculate \[5000\cdot 1.11^{4\cdot 5}\]

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## More answers

- anonymous

wait how do i write 11% ??? 0.11 or 1.11 ??? ... and i dont no how to do that equation on a calculator

- anonymous

the final answer is 35311.56$

- anonymous

you do it like this:

- nowhereman

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

- anonymous

\[5000(1+(11/100))^{5*4}\]

- anonymous

got it?

- anonymous

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

- anonymous

no, that is wrong

- anonymous

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

- nowhereman

Is it 11% anually or quarterly?

- anonymous

i meant to write 1 + 0.11

- anonymous

quarterely

- anonymous

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

- 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"

- anonymous

umm im doing it on my cellphone calculator so no

- anonymous

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

- anonymous

damn, you should get a casio fx series

- nowhereman

you can also do it on google or wolframalpha

- anonymous

http://cgi.ebay.com/Casio-FX-82MS-Scientific-2-Line-Display-Calculator-82ms-/120706498016?pt=Calculators&hash=item1c1aaafde0

- anonymous

or even better this: http://cgi.ebay.com/Brand-New-Casio-FX-991ES-Scientific-Calculator-/260592979882?pt=Calculators&hash=item3cac8d4faa

- anonymous

sooo how do i write down the equation

- anonymous

it can solve integrals, derivatives, logarithms, anything

- nowhereman

http://www.google.com/#hl=en&sugexp=ldymls&xhr=t&q=5000*(1%2B0.11)^(4*5)&cp=19&pf=p&sclient=psy&aq=f&aqi=&aql=&oq=5000*(1%2B0.11)^(4*5)&pbx=1&bav=on.2,or.r_gc.r_pw.&fp=c99decee79d1fe4a

- anonymous

like this:
A = 5000(1+(11/100))^5∗4

- anonymous

which is:
= 5000(1.11)^20

- anonymous

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

- anonymous

ok thank uu

- anonymous

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)

- anonymous

24 years

- anonymous

ok i got it right thx :)

- anonymous

you just divide 72 by the percentage

- anonymous

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

- anonymous

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

- anonymous

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

- anonymous

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

- anonymous

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

- anonymous

6. is right
7. is right

- anonymous

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

- anonymous

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

- anonymous

thats right

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