3 A debt of 2000 due in one year is to be repaid by a payme

3) A debt of $ 2000 due in one year is to be repaid by a payment due two years from now and a fnal payment of $1000 three years from now. If the interest is at the rate of 4% compounded annually, then the payment due in C) $1118.46 4) If an investment of $20,000 earns interest at an annual rate of 9% compounded continuously, then the value (in two years is A) 81155.43 B) 81203.14 D) 81191.00 E) 81000.00 dollars) of the investment six years from now is A) 20,000(1.09)-6 B) 20,000(1.09)6 C) 20,000e0.54 D) 20,000e-0.54 0.54 20,000 E) 5) If an investment of$12,000 earns interest at an annual rate of 7% compounded continuously, then the value (in dollars) of the investment ten years from now is A) 12,000(1.07)10 B) 12,000(1.07)-10 C) 12,000 D) 12,000e07 E) 12,000- 0.7 6) If money earns interest at an annual rate of 8% compounded continuously, then the value (in dollars) of $10,000 due at the end of five years is A) 10,000e-0.4 B) 10,000 C) 10,000e0.4 D) 10,000(1.08)-5 E) 10,000(1.08)5

Solution

solution-

formula for compound interest is given by-

question4.

R=9, P=20000, t=6

putting in the formula

A= 20000*(1.09)⁶ $

question5.

R=7, P=12000, t=10

putting in the formula

A= 12000*(1.07)¹⁰ $

question6.

R=8, P=10000, t=5

putting in the formula

A= 10000*(1.08)5 $

question7.

A=3P ,

now putting in formula

3P=P[1.1]^t

t=ln3/ln1.1