Homework answers / question archive /  You just received a bonus of $4,000

 You just received a bonus of $4,000

Accounting

Share With

 You just received a bonus of $4,000.
a) Calculate the future value of 54,000. given that it will be held in the bank for 7 years and earn an annual interest rate of 6 percent. 
b) Recalculate part (a) using a compounding period that is (1) semiannual and (2) bimonthly. 
c) Recalculate parts (a) and (b) using an annual interest rate of 12 percent. 
d) Recalculate part (a) using a time horizon of 14 years at an annual interest rate of 6 percent. 
e) What conclusions can you draw when you compare the answers in parts (c) and (d) with the answers in parts (a) and (b)?