Interest Rates

Question

How much money should be invested in an account at an annual rate 8%, compounded SEMIANNUALLY, in order to have $12,775 in 10 years? Find the amount of interest being paid for the desired amount.

Answer 1

Assume x dollar is invested initially:

 

x * (1+0.08/2)^2*10 = 12775

x  = 12775 / (1.04)^20 = 12775 / 2.191 = 5830