How much would you have to repay on a credit card debt of $3500 after two years if the interest rate is: a 19.5% compounded annually? b 19.5% compounded half-yearly (the interest rate will be half of 19.5 for half a year)?
Answers
Answered by
6
Answer:
a) 4998.08
Step-by-step explanation:
a) 19.5/100*19.5 = 3.8025 ( first year will act as simple interest and second year will act as compounded).
3.8025 + 19.5 + 19.5 = 42.8025 % of 3500 = 1498.08 Interest + 3500 = total payment of $4998.08
Answered by
1
Answer:
a) $4998.09
Step-by-step explanation:
V=P*(1+r/100)^n
P is the amount invested
r is rate of interest
n is the number of years of compound interest.
3500 * (1+19.5/100)²
= 3500 * (1.195)²
= 4998.0875
Since it is currency, put it in 2 decimal place
(round up because 5 or higher)
= $4998.09
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