Simple interest:

principal x rate x time

2780.20 x 0.043 x 7/12

= 2780.20 x 0.043 x 0.58333

= 69.73668, round to 69.74 and add original principal 2780.20 = 2,849.94 end balance

compound interest:

n = 23 * 2 = 46

r = 0.029 / 2 times per year = 0.0145

FV = PV(1 + r)^n

FV = 723(1.0145^46)

= $1,401.95

A.

Simple interest = Principal x interest rate x time

Simple Interest = 2780.20 x 4.3% x 7/12 = 69.74

balance would be 2780.20 + 69.74 = 2,849.94

B

Future value is given by the formula

FV = PV x (1 + i)^n

PV = present value = 724

i = discount rate = 2.9%/2 (every 6 monthly period)

n = 23 x 2 = 46 (6 monthly periods)



FV = 723 x (1 + 1.45%)^46

FV = 1,401.95

http://www.tvmschools.com/calculator/fut...