College Algebra (6th Edition)

Published by Pearson
ISBN 10: 0-32178-228-3
ISBN 13: 978-0-32178-228-1

Chapter 8 - Sequences, Induction, and Probability - Exercise Set 8.3: 81

Answer

a). Total Scholarship fund at the end of 10 year = 693,030.8 b). Interest = 293,030.8

Work Step by Step

a). Invest per three month = 10000 Compound interest rate quarterly is 10.5% = 0.105 Total Scholarship fund at the end of n year = $\frac{P [(1 + \frac{r}{n})^{n\times t} - 1]}{\frac{r}{n}}$ Total Scholarship fund at the end of 10 year = $\frac{10000 [(1 + \frac{0.105}{4})^{4\times 10} - 1]}{\frac{0.105}{4}}$ = 10000$\times$ 69.3 = 693030.8 b). Interest = 693030.8 - (10000$\times$4$\times$10) = 171271.4 - 400000 = 293030.8
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