Exam 10: Compound Interest - Further Topics

PWC recently proposed to BMO to change the method of compounding interest on line of credit accounts to monthly compounding, as part of the marketing campaign. If the current rate is 2.5% compounded quarterly, what nominal rate should the PWC suggest to BMO executives to maintain the same effective rate of interest?

Calculate the nominal rate of interest compounded semi-annually that will double money in eight years.

In how many months will money double at 7.45% compounded semi-annually?

Calculate the nominal annual rate of interest compounded quarterly that is equivalent to 15% p.a. compounded semi-annually.

At what nominal rate of interest compounded quarterly will $ 13 000.00 earn $8407.27 in interest in six years? (nearest hundredth)

You have an interest rate of 8.44% compounded quarterly. What is the equivalent effective annual interest rate?

Calculate the effective rate of interest, if $10 000 grew to $15 000 in 4 years with quarterly compounding.

Calculate the effective annual rate for 5% p.a. compounded semi-annually.

Calculate the nominal rate of interest compounded semi-annually that is equivalent to 8.4% compounded monthly.

In how many days will $770.00 grow to $880.00 at 11.5% p.a. compounded monthly?

At what nominal rate of interest compounded semi-annually will $11 800 earn $6 800 interest in six years?

In how many years will money triple at 12% compounded semi-annually?

How long will it take Whitby's population to grow from 125 000 (in 2013)to 200 000, if the annual growth rate is 3%? Round your answer to the nearest month.

What is the nominal rate of interest at which money will triple itself in eight years and six months if compounded semi-annually?

For a given interest rate of 10% compounded quarterly, what is the equivalent nominal rate of interest with monthly compounding?

A financial obligation requires the payment of $1500.00 in nine months, $700.00 in twenty-one months, and $1700.00 in 33 months. When can the obligation be discharged by a single payment of $3900.00 if interest is 8.44% compounded quarterly?

A financial obligation requires the payment of $1000.00 in nine months, and $500.00 in twelve months. When can the obligation be discharged by a single payment of $1700.00 if interest is 12% compounded quarterly?

The Brick store credit card quotes a rate of 1.75% per month on the unpaid balance. When Leons took over Brick's management, they reduced the card's effective rate by 4%. What will be the new periodic rate per month?

How long, in compounding periods, will it take for $3327 to increase by $3799 if you are able to earn 6.2% compounded semi-annually?

BlackBerry took a loan contract which requires a payment of $40 million plus interest two years after the contract's date of issue. The interest rate on the $40 million face value is 9.6% compounded quarterly. Before the maturity date, the original lender sold the contract to a pension fund for $43 million. The sale price was based on a discount rate of 8.5% compounded semi-annually from the date of sale. How many months before the maturity date did the sale take place?