Neil and John both need $20,000 to clear off a mortgage payment after 10 years. Neil invests $15,000 at 3 percent per annum of simple interest for 10 years, and John invests $15,000 at 3 percent compound interest compounded annually for 10 years. Who would be able to repay the amount from this investment easily?

John

Explanation:

Neil will have the following amount after ten years.

Simple interest is calculated using the formula,

I= p x r x t

where I= interest, P= principal amount, r = interest rate, t is time

for Neil interest will be= $15,000 x 3/100 x 10

=$15,000 x 0.03 x 10

=$4500

Neil will have principal + interest amount

=$4,500 + $15,000

=$19,500

John invested in a compound interest account.

The amount after ten years will be

The formula for compound interest is

FV = PV × (1+r)^n

where FV = Future Value

PV = Present Value

r = annual interest rate

n = number of periods

After ten years, John will have

Fv= $15,000 x (1 + 3/100)^10

Fv= $15,000 x (1.03)^10

FV =$15,000 x 1.34391

Fv = $15,158.75

John will be able to clear his mortgage.

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.

answer; the cpi;