Full resolution (JPEG) - On this page / på denna sida - Arithmetic - Compound interest
<< prev. page << föreg. sida << >> nästa sida >> next page >>
Below is the raw OCR text
from the above scanned image.
Do you see an error? Proofread the page now!
Här nedan syns maskintolkade texten från faksimilbilden ovan.
Ser du något fel? Korrekturläs sidan nu!
This page has never been proofread. / Denna sida har aldrig korrekturlästs.
24 COMPOUND INTEREST.
Compound Interest Computed Semi=Annually.
When compound interest is to be computed semi-annually,
use Table No. 3. Under the given rate and opposite the given
number of years, find the amount of one dollar invested and
interest computed semi-annually for the time taken. Multiply
this by the principal invested, and the product is the amount.
Example.
$350 is put in a savings bank paying 4%, computed semi-
annually. What is the amount in 10 years ?
Solution
:
Under 4%, and opposite 10 years, we find the number
1.4860. This we multiply by the principal invested.
Thus:
1 .485949
350
520.08215 = $520.08 = Amount.
To compute compound interest for longer time than
is given in the tables, figure the amount for as long a time
as the table gives ; then consider this amount as a new princi-
pal invested, and use the table and figure again for the rest of
the time.
Example.
What is the amount of $40, left in a savings bank 18 years,
at 4%, and the interest computed semi-annually. The table
only gives 12 years, therefore we will look opposite 12 years,
under 4%, and find the number 1.608440. This we multiply by
the principal invested.
Thus:
1.608440
40
64.3376
But now we have to compute for 6 years more, therefore
under 4%, and opposite 6 years, we find the number 1.268243.
Multiplying this by the principal, which is now considered as
being invested 6 years more, we have :
1.268243 X 64.3376 = $81.60 = Amount.
Thus, $40, invested at 4% interest, computed semi-annually,
will, after 18 years of time, amount to $81.60.
<< prev. page << föreg. sida << >> nästa sida >> next page >>
