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3 1a Compound and Simple Interest Prob 2

The document calculates the amount at the end of two years and seven months for an investment of Php 1000 at an 8% interest rate compounded quarterly. It finds the future value after two years to be Php 1171.66 and adds the simple interest for the additional seven months, resulting in a total of Php 1226.34. The calculations involve both compound and simple interest formulas.

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andrewgwapo2000
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194 views2 pages

3 1a Compound and Simple Interest Prob 2

The document calculates the amount at the end of two years and seven months for an investment of Php 1000 at an 8% interest rate compounded quarterly. It finds the future value after two years to be Php 1171.66 and adds the simple interest for the additional seven months, resulting in a total of Php 1226.34. The calculations involve both compound and simple interest formulas.

Uploaded by

andrewgwapo2000
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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2.

Find the amount at the end of two years and seven months if Php 1000 is invested at 8%
compounded quarterly using simple interest for anytime less than a year interest period.

Solution:

For compound interest: i=0.08/4=0.02 , n=(2 years)(4)=8

For simple interest: i=0.08 , n=7/12

For two years: F=P(1+i)ⁿ=1000(1+.02)⁸=Php 1171.66

For the last & months: F=Pni=1171.66(7/12)(0.08)= Php1226.34

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