Interest - Bearing Bank Accounts and Inflation Section 10.2 Interest - Bearing Bank Accounts and Inflation

Find Interest Compounded DAILY Use tables on P 411 and 412 … The four quarters in a year begin on Jan 1, April 1, July 1, and Oct 1. Assume each is 90 days. If working with less than a 90-day quarter, use the large table on p 412. Cmpnd Amt = Principal x # from table Interest = Compound Amt - Principal

Find the interest if $1200 is invested in a money market account earning 3.5% compounded daily for 90 days. A money market account is opened with a deposit of $8500 on April 10, and another $1500 is deposited on May 5. Find the total in the account on June 30 if the funds earn 3 ½ % compounded daily. Also find the interest earned.

An account is opened with a deposit of $4000, but $3000 is withdrawn 40 days later. Find the amount in the account and the interest earned at the end of 90 days from the original deposit if 3 ½ % interest is compounded daily. How much interest would there have been if the $3000 wasn’t withdrawn?

Time Deposit Accounts A.K.A. – CD (Certificate of Deposit) Banks offer higher interest rates on amounts left for longer periods of time. Use table on P 414 Compound = Principal x # from Amount table

Find the compound amount and interest on $10,000 invested in a 4- year CD earning 6% compounded daily.