Mathematics, 02.01.2020 19:31 lea5261

Sergio has decided to diversify his investments in the following way:
$4,000 in an account earning 3.2% simple interest
$4,000 in a savings account earning 2.1% interest compounded annually
$7,500 in a certificate of deposit earning 5% interest compounded quarterly
how much total interest will sergio earn on his investments at the end of 4 years?
a.
$1,240.82
b.
$2,123.90
c.
$2,497.17
d.
$2,507.90

Answers: 1

Show answers

Answers

Answer from: heysorryguys

The total interest Sergio earns is $ 2507.90 .

Option (d) is correct .

Step-by-step explanation:

First part

Formula

$Simple\ interest = \frac{Principle\times Rate\times Time}{100}$

As given

$4,000 in an account earning 3.2% simple interest for 4 years .

Put all the values in the formula

$Simple\ interest = \frac{4000\times 3.2\times 4}{100}$

$Simple\ interest = \frac{51200}{100}$

Simple interest = $512

Thus interest is $512 when invested $4000 in an account earning 3.2% for 4 years .

Second part

Formula

$Amount = P(1 + r)^{t}$

Amount = P + Interest

Where P is the principle , r is the rate of interest in the decimal form and t is the time in years .

As given

$4,000 in a savings account earning 2.1% interest compounded annually for 4 years .

P = $4000

2.1% is written in the decimal form

$= \frac{2.1}{100}$

= 0.021

r = 0.021

t = 4 year

Put all the values in the formula

$Amount = 4000(1 +0.021)^{4}$

$Amount = 4000(1.021)^{4}$

$Amount = 4000\times 1.08668$

Amount = $4346.72

Thus

$4346.72 = $4000 + Interest

Interest = $4346.72 - $4000

Interest = $346.72

Thus interest is $346.72 when invested $4,000 in a savings account earning 2.1% for 4 years .

Third part

Formula

$Amount = P(1 +\frac{r}{4})^{4t}$

Amount = P + Interest

Where P is the principle , r is the rate of interest in the decimal form and t is the time in years .

As given

$7,500 in a certificate of deposit earning 5% interest compounded quarterly .

P = $7500

5% is written in the decimal form

$=\frac{5}{100}$

= 0.05

r = 0.05

t = 4 years

Put all the values in the formula

$Amount = 7500(1 +\frac{0.05}{4})^{4\times 4}$

$Amount = 7500(1 +\frac{0.05}{4})^{16}$

$Amount = 7500(1 +0.0125)^{16}$

$Amount = 7500(1.0125)^{16}$

$Amount = 7500\times 1.21989$

Amount = $9149.175

$9149.175 = $7500 + Interest

Interest = $9149.175 - $7500

Interest = $1649.175

Thus interest is $1649.175 when invested $7,500 in a certificate of deposit earning 5% for 4 years .

Thus

Total interest Sergio earns = Interest from simple interest + Interest from compounded annually + Interest from compounded quarterly .

Put all the value in the above

Total interest Sergio earns = $512 + $346.72 + $1649.175

= $ 2507.90 (Approx)

Therefore the total interest Sergio earns is $ 2507.90 .

Option (d) is correct .

Answer from: Quest

, ; dcbsdkmnld

step-by-step explanation:

Answer from: Quest

check out this website

you will enjoy it as it give interesting things to look up or do!

Another question on Mathematics

Mathematics, 21.06.2019 19:30

You have 17 cats that live in houses on your street, 24 dogs, 3 fish, and 4 hamsters. what percent of animals on your block are dogs?

Answers: 2

Answer

Mathematics, 21.06.2019 23:00

Which graph represents the linear function below? y-3=1/2(x+2)

Answers: 2

Answer

Mathematics, 21.06.2019 23:30

Afactory buys 10% of its components from suppliers b and the rest from supplier c. it is known that 6% of the components it buys are faulty. of the components brought from suppliers a,9% are faulty and of the components bought from suppliers b, 3% are faulty. find the percentage of components bought from supplier c that are faulty.

Answers: 1

Answer

Mathematics, 22.06.2019 00:00

Ineed on this question me get the answer

Answers: 1

Answer

You know the right answer?

Sergio has decided to diversify his investments in the following way:
$4,000 in an account ea...

Questions