Question

Bill Casler bought a $1000, 9-month certificate of deposit (CD) that would earn 8% annual simple interest. Three months before the CD was due to mature, Bill needed his CD money, so a friend agreed to lend him money and receive the value of the CD when it matured.
(a) What is the value of the CD when it matures?
value = ? $
(b) If their agreement allowed the friend to earn a 10% annual simple interest return on his loan to Bill, how much did Bill receive from his friend? (Round your answer to the nearest cent.) value = ?

Answer 1

Answer:

a) The value (M) of a CD when it matures = $ 1060

b) The amount bill receive new agreement is $ 1034.146

Step-by-step explanation:

Step - by - step explanation is defined in the attachment .