I want to open a Time Deposit Account, the bank gave me a interest of 3.65% for a three months time deposit. Can you help me compute how much my $2,000 will earn in cash, if you can give the formula it will be much helpfull so I could compare with 3,6,12 months plan
2006-10-19 03:16:10 · 7 answers · asked by civilestimator 2 in Business & Finance ➔ Investing
Bank deposits compound daily using Actual/360 accrual. The formula is:
F = P * (1+R/360)^N
where:
F = Future Value
P = present Value
R = annual rate
N = actual number of days.
In your case, the interest paid will depend on how many days are in the three months in question:
90 days: $18.33
91 days $18.54
92 days $18.74
2006-10-19 06:36:30 · answer #1 · answered by Ranto 7 · 0⤊ 0⤋
Term Deposit Formula
2016-12-16 10:24:48 · answer #2 · answered by kluesner 4 · 0⤊ 0⤋
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This is called a "sinking fund" e.g. One whose purpose is to pay for future needs. Let the future value be FV, the periodic interest rate is i The periodic payment is A, n is the number of periods the formula is: FV = A (((1 + i) ^ n) -1) / i) so in your case, i = .075/4, (quarterly interest rate) A = 300 * 3 = $900 (amount invested each quarter) n=5yr * 4 periods /yr == 20 periods Substituting and using my calculator I get $21,597.51 !! seems about right for an $18,000 investment @ 7.5%
2016-04-02 04:12:52 · answer #3 · answered by Anonymous · 0⤊ 0⤋
A deposit account of $2,000 at 3.65% (simple interest) per year for three months earns $2,000 x 0.0365 / 12 x 3 = $18.25 in interest. If the bank compounds, which they may or may not do, your interest will be slightly higher.
Hope this helps
2006-10-19 04:33:21 · answer #4 · answered by Adoptive Father 6 · 0⤊ 1⤋
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2006-10-19 03:21:14 · answer #5 · answered by Duncan E 1 · 0⤊ 1⤋
interest = principal x rate x term
2006-10-19 06:19:02 · answer #6 · answered by weenafive 2 · 0⤊ 1⤋
that is an awful rate & should not do it.
2006-10-19 09:55:53 · answer #7 · answered by vegas_iwish 5 · 0⤊ 1⤋