PFIN Fall 2018 Hughes MWF 9am ibrahim abdullahi & 9/17/18 8:18 AM Quiz: Chapter
ID: 2817939 • Letter: P
Question
PFIN Fall 2018 Hughes MWF 9am ibrahim abdullahi & 9/17/18 8:18 AM Quiz: Chapter 3 Quiz Time Remaining: 01:40 34 Submit Quiz This Question: 1 pt 7 of 8 (0 This Quiz: 8 pts possible t agreed to defer payments for two years until afer Jim graduates from college. How much willJim owe in two years if his uncle In two years Jim will owe S(Round to the to the nearest cent) (Use your inancial.cakculator or you may use the Financial Tables in Agpendix C in (Use your Enter your answer in the answer box F9Explanation / Answer
Compound Interest Formula is given as follows
A = P ( 1+ r/n)n*t
were A = Amount
P= Principal amount
r = Interest rate in decimal
n = number of times interest is compunded per year
t = time in years
P = $ 3,000 r = 7% or 0.07 n=1 t = 2 years
A = 3,000 ( 1+ 0.07/1 )1*2
A= 3000 ( 1.07)2
A= 3000 * 1.1449
A = $ 3434.70
Therefore in two years Jim will owe $3434.70 to his uncle.
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