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**Consider the $50,000 excess cash.**

Assume that Gary invests the funds in a one year CD

a. What is the CD s value at maturity( future calue)if it pays 10 percent(annual) interest?

b. What will its future value be if the CD pays 5 percent interest?

If it pays 15 percent interest?

**Answer**

By calculating interest at 10% for 1 year on CD Interest = 50,000 * 10 * 1/100 Therefore future value = 50,000 + Interest = 55000 Similary at 5%, future value is 52500 and at 15%, future valuer is 57500

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##### Virtual Teaching Assistant: Colleen R.

##### Question Level: Basic

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##### Upload Date: 5/31/2017

This 52 words question was answered by Colleen R. on StudySoup on 5/31/2017. The question contains content related to Business Since its upload, it has received 95 views.