Asked by Saharnaz Pourhaghgouy on Jun 16, 2024
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What quarterly payment is required to accumulate to a future value amount of $10,000 in eight years if money earns 4.5% compounded quarterly?
Compounded Quarterly
A method where interest is computed on the original amount as well as on the interest that has been added over prior periods, and this calculation occurs quarterly.
Quarterly Payment
A payment or installment made once every three months.
Future Value
The value of an investment at a specific date in the future, accounting for factors like interest rates and time.
- Apply principles related to the time value of money to establish the value of annuities and bonds.
- Scrutinize the relationship between the frequency of compounding and its consequences on investment yields and loan expenditures.
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Learning Objectives
- Apply principles related to the time value of money to establish the value of annuities and bonds.
- Scrutinize the relationship between the frequency of compounding and its consequences on investment yields and loan expenditures.
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