You are quoted an interest rate of 7% on an investment of $2 million. What is the value of your investment after seven years if interest is compounded as follows. How do I calculate for monthly?
Formula for compounding is given below
Value of investment after n year = principal amount * (1 + i/c)^(n*c)
where Principal amount = $2 Million
i = 7%
c = 12 since it is monthly
n = 7 years
Value of investment after 7 years = 2 Million * (1 + .07/12)^(7*12)
= 2 Million * 1.63
= 3.26 Million
Value of investment after 7 year compounded monthly = $3.26 Million
You are quoted an interest rate of 7% on an investment of $2 million. What is...