FNAN 301 Extra problems ? lab 1 1. Silvio just invested $6,200 for 12 years and will earn compound interest of 7.6 percent per year. Renaldo just invested $7,600 for 12 years and will earn simple interest of 8.0 percent per year. a. Who will have more money in 12 years? b. In 12 years, what will Silvio?s wealth minus Renaldo?s wealth be? 2. Jackson just deposited $23,000 in an account that will earn 4.0 percent per year in compound interest for 16 years. If Andrea deposits $23,000 in an account today that earns simple interest, then how much simple interest per year must Andrea earn to have the same amount of money in 16 years as Jackson will have in 16 years? 3. Sheila just invested $4,800 for 7 years and will earn compound interest of 5.2 percent per year. Today, Deng can make an investment and earn simple interest of 5.8 percent per year. If Deng wants to have just as much as Sheila in 7 years, then how much should Deng invest today? PAGE PAGE 1
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