Find the amount in an account if $2,000 is invested at 6.125%,compounded semi-annually,for 2 years.
A)$2256.49
B)$2252.50
C)$2324.89
D)$544,757.84
Get yourself a pocket calculator or sharpen your pencil. The new amount will be
2000*(1.030625)^4
The 1.030625 factor is what the principal gets multipled by every 6 months. The answer is indeed one of the 4 choices. If is it D, tell me the name of the bank and I will put my money there.
Thanks I appreciate the help!
I needed a different calculator
I had the formula right
the answer is (A)
Right on!
To find the amount in the account, we can use the compound interest formula:
A = P(1 + r/n)^(nt)
Where:
A = the final amount
P = the initial investment
r = the annual interest rate (in decimal form)
n = the number of times interest is compounded per year
t = the number of years
In this case, P = $2,000, r = 6.125% = 0.06125 (as a decimal), n = 2 (compounded semi-annually), and t = 2 years.
Substituting these values into the formula, we get:
A = 2000(1 + 0.06125/2)^(2*2)
= 2000(1.030625)^4
Now, to find the final amount, you can use a calculator or the decimal equivalent chart provided. Evaluating this expression, we get:
A = 2000(1.030625)^4
≈ $2256.49
Therefore, the correct answer is A) $2256.49.