Answer:
(i) $133.12
(ii) $297.6
(iii) $300.8
(iv) $301.6
Explanation:
From the compounding formula;
Future value = Present value [tex](1+\frac{r}{m}) ^{mn}[/tex]
where r is the rate, m is the number of payment per year, and n is the number of years.
Interest = future value - present value
Given that present value = $800, r = 8%, n = 4 years.
(i) annually,
m = 1, so that;
Future value = 800[tex](1.08)^{4}[/tex]
= $933.12
Interest = $933.12 - $800
= $133.12
(ii) quarterly,
m = 3, so that;
Future value = 800[tex](1+\frac{0.08}{3}) ^{(4x3)}[/tex]
= 800(1.372)
= $1097.6
Interest = $1097.6 - $800
= $297.6
(iii) monthly,
m = 12, so that;
Future value = 800[tex](1+\frac{0.08}{12}) ^{(4x12)}[/tex]
= 800(1.376)
= $1100.8
Interest = $1100.8 - $800
= $300.8
(iv) weekly,
m = 54, so that;
Future value = 800[tex](1+\frac{0.08}{54}) ^{(4x54)}[/tex]
= 800(1.377)
= $1101.6
Interest = $1101.6 - $800
= $301.6
