If $425 is invested in an account that earns annual interest of 7.5%, compounded semiannually, what will the account balance be after 11 years? (Round your answer to the nearest cent.)
math - Henry, Wednesday, August 22, 2012 at 8:28pm
P = Po(1+r)^n.
Po = $425.
r = (7.5%/2) / 100% = 0.0375 = Semi-annual rate expressed as a decimal.
n = 2Comp/yr * 11yrs = 22 Compounding
Plug the above values into the given Eq.
Answer: P = $955.27.