Please include how you calculated the answer - any formulas, websites used, etc...
2006-11-20 05:19:36 · 2 answers · asked by Angie A 3 in Business & Finance ➔ Investing
well, you didn't mention the compounding factor, so....
simple interest
A sub t is the value (amount) after "t" time
P is the initial amount invested
r is the interest rate
t is time ( in years)
A sub t = P ( 1 + r) ^ t
for compound interest rate
n is the number of times that the interest is compounded per year
A sub t = P ( 1 + r/n) ^ (n*t)
now, you have another problem...
some CDs only pay interest yearly....
some quarterly, some monthly...
since your interest rate is different from your APR,
I'll assume a monthly compounding
Amt = $2000 ( 1 + (.0489/12)) ^ (12* (11/12))
note: the time is 11/12 because interest is figured on a yearly basis and 11 months is 11/12 of a year
if my calculator does not deceive me
you should get $2091.50
2006-11-20 05:42:59 · answer #1 · answered by Gemelli2 5 · 0⤊ 0⤋
about $91
2000 x .05 /12 x 11
compounding rules can affect the answer
2006-11-20 13:31:38 · answer #2 · answered by Anonymous · 0⤊ 0⤋