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| OPERATION |
| DISPLAY |
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| .05 |
| 0.05 |
| 0.05 | ÷ | Annual int. rate |
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| 4 |
|
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| 4. | = |
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| 0.0125 |
| Quarterly int. rate |
|
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|
| 0.0125 |
| 0.0125 |
|
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|
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| 0.0125 |
| + |
| |
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| 1 |
| 1.0125 |
| 1. | + |
| |
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| 1.0125 | ◊ | (1 + i) |
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|
| 1.0125 |
| 1.0125 | ⋅ |
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| |||
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|
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| 1.0125 | = |
|
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|
| 1.02515625 |
| (1 + i)2 |
|
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|
|
| 1.02515625 |
| 1.02515625 |
|
|
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|
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|
|
| 1.02515625 |
| ⋅ |
| |
|
|
|
|
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|
|
| 1.02515625 | = |
|
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|
|
|
|
|
|
| 1.050945336 |
| (1 + i)4 |
|
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|
|
| 1.050945336 |
| 1.050945336 |
|
|
|
|
|
|
|
| 1.050945336 |
| ⋅ |
| |
|
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|
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| 1.050945336 | = |
|
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|
|
|
|
|
|
| 1.104486099 |
| (1 + i)8 |
|
|
|
|
|
| 1.104486099 |
| 1.104486099 |
|
|
|
|
|
|
|
| 1.104486099 |
| ⋅ |
| |
|
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| 1.104486099 | = |
|
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|
|
|
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| 1.219889542 |
| (1 + i)16 |
|
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| 1.219889542 |
| 1.219889542 |
|
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|
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| 1.219889542 |
| ⋅ |
| |
|
|
| 6150 |
|
|
| 6,150. | = | Principal | |
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| 7,502.320683 |
| New balance |
|
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|
|
| 7,502.320683 |
|
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– 49 –