Question

Candace invested $16,000 into a fund earning 11.0% interest compounded 12 times per year. Calculate her...

Candace invested $16,000 into a fund earning 11.0% interest compounded 12 times per year. Calculate her balance after 16 years.

Round your answer to the nearest dollar. Do not include a dollar sign.

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Answer #1

We are required to compute the Future value of current investment

Given information

Investment

16,000.00

Interest rate

11%

Compounding frequency

12

Rate per compounding period (Interest rate / compounding frequency)

0.92%

No. of periods

               16

No. of compounding periods (no. of periods x compounding frequency)

             192

FV factor ---> Formula --> (1+rate per compounding period)^no. of compounding periods

--> (1+0.92%)^192

5.77

Balance after 16 years (Investment amount x FV factor) rounded off nearest dollar

92,256

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