Use the Compound Interest Table to Calculate the Maturity Value

question 35

Short Answer

Use the compound interest table to calculate the maturity value of an inheritance of $2,000, using 8% interest, compounded quarterly for 4 years. $\begin{array}{rccccccc}\hline n & 0.5 \% & 1 \% & 1.5 \% & 2 \% & 3 \% & 4 \% & 5 \% \\\hline 1 & 1.00500000 & 1.01000000 & 1.01500000 & 1.02000000 & 1.03000000 & 1.04000000 & 1.05000000 \\2 & 1.01002500 & 1.01010000 & 1.03022500 & 1.04040000 & 1.06090000 & 1.08160000 & 1.10250000 \\3 & 1.01507513 & 1.03030100 & 1.04567837 & 1.06120800 & 1.09272700 & 1.12486400 & 1.15762500 \\4 & 1.02015050 & 1.04060401 & 1.06136355 & 1.08243216 & 1.12550881 & 1.16985856 & 1.21550625 \\5 & 1.02525125 & 1.05101005 & 1.07728400 & 1.10408080 & 1.15927407 & 1.21665290 & 1.27628156 \\\\6 & 1.03037751 & 1.06152015 & 1.09344326 & 1.12616242 & 1.19405230 & 1.26531902 & 1.34009564 \\7 & 1.03552940 & 1.07213535 & 1.10984491 & 1.14868567 & 1.22987387 & 1.31593178 & 1.40710042 \\8 & 1.04070704 & 1.08285671 & 1.12649259 & 1.17165938 & 1.26677008 & 1.36856905 & 1.47745544 \\9 & 1.04591058 & 1.09368527 & 1.14338998 & 1.19509257 & 1.30477318 & 1.42331181 & 1.55132822 \\10 & 1.05114013 & 1.10462213 & 1.16054083 & 1.21899442 & 1.34391638 & 1.48024428 & 1.62889463 \\\\11 & 1.05639583 & 1.11566835 & 1.17794894 & 1.24337431 & 1.38423387 & 1.53945406 & 1.71033936 \\12 & 1.06167781 & 1.12682503 & 1.19561817 & 1.26824179 & 1.42576089 & 1.60103222 & 1.79585633 \\13 & 1.06698620 & 1.13809328 & 1.21355244 & 1.29360663 & 1.46853371 & 1.66507351 & 1.88564914 \\14 & 1.07232113 & 1.14947421 & 1.23175573 & 1.31947876 & 1.51258972 & 1.73167645 & 1.97993160 \\15 & 1.07768274 & 1.16096896 & 1.25023207 & 1.34586834 & 1.55796742 & 1.80094351 & 2.07892818 \\\\16 & 1.08307115 & 1.17257864 & 1.26898555 & 1.37278571 & 1.60470644 & 1.87298125 & 2.18287459 \\17 & 1.08848651 & 1.18430443 & 1.28802033 & 1.40024142 & 1.65284763 & 1.94790050 & 2.29201832 \\18 & 1.09392894 & 1.19614748 & 1.30734064 & 1.42824625 & 1.70243306 & 2.02581652 & 2.40661923 \\19 & 1.09939858 & 1.20810895 & 1.32695075 & 1.45681117 & 1.75350605 & 2.10684918 & 2.52695020 \\20 & 1.10489558 & 1.220190&1.34685501 & 1.48594740 & 1.80611123 & 2.19112314 & 2.65329771\end{array}$

---

Definitions:

Marketable Securities

Financial instruments that can be easily converted to cash without significant loss of value.

Restrictive Policy

This refers to a fiscal or monetary policy aimed at reducing the amount of money circulating within an economy, often to curb inflation.

Setup Equipment Costs

The initial costs associated with purchasing and installing new equipment or machinery for use in operations.

Shortage Cost

The costs incurred when demand for a product exceeds the supply, including potential lost sales, customer dissatisfaction, and additional operational costs to manage the shortage.