What is the amount you will have in the bank at the end of 18 years if interest of 6 % compounded monthly for first 5 years and interest of 10 % compounded quarterly for the remaining years?

Your bank balance at the end 18 years will depend on your initial investment as well as the rate of interest. After 18 years of investing $1000, with 6% monthly compounded interest for the first 5 years then 10% quarterly compounded for the rest of 13 years you will have a balance of around $7,000.

In order to determine this sum, we need to consider the compounding of interest and the value time. Compounding means reinvesting the interest earned. This can maximize your returns. The Time Value of Money (TVM), which is a measure of how much an amount would be worth today if it were invested at a specific rate of return, assumes money will have a higher value if received earlier rather than later because inflation decreases the purchasing power of money over time.

Applying these concepts, we can calculate the potential earning by taking into account different factors such as investment duration or rate of compounding. If we reinvest our original deposit and any interest earned after every month/quarter, then our new balance by 18 years should be around $7000.