All answers should be rounded to 2 decimal places. Deann purchased 75 shares of

Question

All answers should be rounded to 2 decimal places. Deann purchased 75 shares of a stock for $22.57 each and sold them for $24.17 each. 14 months later. How much money did she earn on one share of stock?___________What was the simple interest rate of her investment? Give your answer as a percent.____________What was the total amount of money earned on her investment?_____________Find the nominal rate equivalent to the simple interest rate from) if the interest were compounded 12 times a year. Use your calculator: APPS>Fmance>Enter. scroll down to Nom>Enter now enter the answer from. a comma, and 12). This would be the equivalent interest rate if compounded monthly._____________

Explanation / Answer

a)The money she earned on one stock would be =24.17-22.57 =1.6

b)Simple interest

SI = PRT/100

Now first the gain = (24.17-22.57)*75 =120

120 = (22.57*75*r *14)/(100*12)

= 120*100*12/(22.57*14)

=6.076%

c) Total amount of money eaned = (24.17-22.57)*75 =120

d)(1+r)^12 = (1+.0676)

r = 1.0676^(1/12)-1

=0.54%

The rate of interst annual wouldbe = 12*0.54% =6.5592%

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