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25 June, 08:02

What would be the value of $100 after 10 years if you earn 11 percent interest per year?

A.) $259.37

B.) $283.94

C.) 110.46

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Answers (1)
  1. 25 June, 08:04
    0
    If the interest is simple interest, then the value is

    100 [ 1 + (10 x 0.11) ] = 100 (1 + 1.1) = 100 x 2.1 = $210.

    If the interest is compound interest, and is compounded annually, then the value is

    100 (1 + 0.11) ¹⁰ = 100 (2.8394) = $283.94.

    If the interest is compound interest, and is compounded monthly, then the value is

    100 (1 + 0.11/12) ¹²⁰ = 100 (2.9891) = $298.91.

    So did you make a mistake with the numbers
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