anonymous
  • anonymous
Two thousand dollars is borrowed for one year at an interest rate of 1.1% per month. If the same amount of money can be borrowed at an interest rate of 13.2% per year, how much could be saved in interest charges?
Economics - Financial Markets
  • Stacey Warren - Expert brainly.com
Hey! We 've verified this expert answer for you, click below to unlock the details :)
SOLVED
At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga. Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus. Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.
katieb
  • katieb
I got my questions answered at brainly.com in under 10 minutes. Go to brainly.com now for free help!
anonymous
  • anonymous
with a monthly compounding interest of 1.1%, total at the end of year will be $2,280.572, Interest Amount = $280.572 with a simple interest of 13.2% per year, total at the end of year will be $2,264.00 Interest Amount = $264.00 Thus, interest diff. = money that could be saved = $16.572. Calculation details: Manual method, I used excel to do below: Month Amount Rate 1 2000 1.011 2 2022 1.011 3 2044.242 1.011 4 2066.729 1.011 5 2089.463 1.011 6 2112.447 1.011 7 2135.684 1.011 8 2159.176 1.011 9 2182.927 1.011 10 2206.939 1.011 11 2231.216 1.011 12 2255.759 1.011 13 2280.572 You can also use the equation at http://www.calculatorsoup.com/calculators/financial/compound-interest-calculator.php to get at same numbers. Hope this helps. Feel free to revert if you need further explanations!

Looking for something else?

Not the answer you are looking for? Search for more explanations.