$2260 at 4% compounded semiannually for 8 years

Question

$2260 at 4% compounded semiannually for 8 years

Answer 1

A = P(1 + r/n)^nt

 

Where:

A = the final value of the investment

P = the initial value of the investment = $2260

r = the annual interest rate = 4% = 0.04

n = the number of times the interest is compounded per year = semi-annual = 2

t = years = 8

 

A = ($2260)(1 + 0.04/2)^2*8

 

A = ($2260)(1.02)¹⁶

 

Use your calculator to solve for A