### Linear equations and financial formulas In Tutorial Library

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### TITLE: Linear equations and financial formulas

#### CLASS / COURSE: Business Algebra

QUESTION DESCRIPTION:

Word Memo (100-150 words) & Spreadsheet

Details:

The purpose of this project is to summarize what you have learned from the material on linear equations and financial formulas. For additional assistance with this assignment, download the Step-by-Step Guide.  **SEE ATTACHED**

As a financial planner, a client comes to you for investment advice. After meeting with him and understanding his needs, you offer him the following two investment options:

• Option 1 (refer to section on Finite Mathematics in your text): Invest \$5,000 in a savings account at 6.6% interest compounded monthly.
• Option 2 (refer to section on Finite Mathematics in your text): Invest into an ordinary annuity where \$1,100 is deposited each year into an account that earns 4.8% interest compounded annually.

Set up the formula for compound interest for Option 1 and the formula for Future Value of an Annuity for Option 2 in an Excel spreadsheet to calculate the amount earned at the end of 6 years. Be sure to label all variables in your spreadsheet.

Memo:

After creating the spreadsheet with the two different investment options, write a memo that addresses the following points for your client:

• Explain to your client what compound interest is.
• Explain to your client what an annuity is.
• From the calculations in the Excel spreadsheet for Option 1 and Option 2, explain which investment option is better for your client and why.

Click the Excel icon for tutorials on using Excel:

SOLUTION DESCRIPTION: Completed Solution is attached. Click on Buy button and then download file to get full solution.

SUBJECTS / CATEGORIES:
1. Finance
2. Accounting
3. Mathematics
4. Quantitative Techniques
5. Others