Question

You deposit $962 in your savings account that pays an annual interest rate of 4.78%. The inflation rate is 1.72%. In nominal terms, how many extra dollars will you have next year?

Answer #1

Amount will be $990.66

Here you gained money. Otherwise for example, Let’s say you have $100 in a savings account that pays a 1% interest rate. After a year, you will have $101 in your account. But if the rate of inflation is running at 2%, you would need $102 to have the same buying power that you started with.

You've gained a dollar but lost buying power. Any time your savings don’t grow at the same rate as inflation, you will effectively lose money.

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Suppose you decide to deposit $16,000 into a savings account
that pays a nominal rate of 7.80%, but interest is compounded
daily. Based on a 365-day year, how much would you have in your
account after six months? (Hint: To calculate the number of days,
divide the number of months by 12 and multiply by 365.)
$16,304.43
$16,470.80
$16,637.17
$16,969.91

Old Time Savings Bank pays 5% annual interest rate on its
savings accounts. If you deposit $2100 in the bank and leave it
there. Assume bank pays annual compounded interest. How much
interest will you earn in the first year? How much interest will
you earn in the thrid year? How much interest will you earn in the
8th year? [Please round your answer to the nearest whole
number]
Multiple Choice
$105;$122;$155
$105;$122;$148
$105;$116;$148
$105;$116;$155

You
currently have $1000 in your savings account. The APR on your
savings account is 9%, and the interest is compounded monthly. If
the annual inflation rate is 6%, how much your current savings will
become in real terms (i.e., in today's dollars) one year from now?
Round your answer to the nearest cent; do not use the $ sign (i.e.,
if the result is $1,234.5678, enter it as 1,234.57).

A) Assume that, starting next year, you make annual deposits of
$ 950 into a savings account that pays 6% interest. How much will
you have in your account after 11 years?
B) You made an investment over the past year, and your nominal
return was 7.3%. Over the same year, the rate of inflation was
3.9%. What was the real rate of return for this investment?
C) Assume that, starting next year, you will make deposits of
$572 each...

Bob deposit $1,000 dollars into a savings account, what
interest would you need to be
earning to have $1,600 dollars in the same account 4 years
later?
Bob deposit $1,000 dollars into a savings account that pays 5%
interest annually, how much
will be in his account after 5 years?

1. If a bank advertises a savings account that pays a 6% nominal
interest rate compounded continuously, what is the effective annual
percentage rate?
2. Bank A offers a nominal annual interest rate of 5% compounded
daily, while Bank B offers continuous compounding at a 4.6% nominal
annual rate. If you deposit $3,000 with each bank, what will be the
difference in the two bank account balances after two years?
(Show ALL work and formulas used!)

1.You are going to deposit $2,800 in an account that pays .54
percent interest compounded quarterly. How much will you have in 8
years?
2.You have $5,000 and will invest the money at an interest rate
of .21 percent per month until the account is worth $9,800. How
many years do you have to wait until you reach your target account
value?
3.You have just started a new job and plan to save $4,500 per
year for 40 years until...

Eric deposits 100 into a savings account at time 0, which pays
interest at an annual nominal rate of i, compounded semiannually.
Mike deposits 200 into a different savings account at time 0, which
pays simple interest at an annual rate of i. Eric and Mike earn the
same amount of interest during the last 6 months of the 8th
year.

"If you deposit $1400 per MONTH into an account that earns an
ANNUAL nominal interest rate of 11%, compounded monthly, how much
money will you have in 10 years?"

If you deposit $2000 in a savings account that pays an interest
equal to 6% Compounded continuously. Whats the balance at the end
of 3 years?

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