Business Math

Lee Holmes deposited $ 15,000 in a new savings account at 9% interest compounded semiannually, At the beginning of year 4, Lee deposites an additional $40000 at 9% interest compounded semiannually. At the end of the 6 years what is the balance in Lee;s account

  1. 👍 0
  2. 👎 0
  3. 👁 1,354
  1. P1 = Po(1+r)^n.

    P1 = Principal after 1st 3 years.

    Po1 = $15,000 = Initial deposit @ beginning of the 1st 3 years.

    r = (9%/2)/100% = 0.045 = Semi-annual %
    rate expressed as a decimal.

    n = 2Comp/yr * 3yrs = 6 Compounding
    periods.

    Solve the given Eq and get:
    P1 = $19,533.90.

    P2 = Po2(1+r)^n.

    P2 = Principal amount after the 2nd 3 years.

    Po2 = 19,533.90 + $40,000 = $59,533.90
    = Initial deposit for 2nd 3 years.

    Solve for P2.

    Answer: P2 = $77,528.63.

    NOTE: r,and n are the same for both P1 and P2 calculations.

    1. 👍 1
    2. 👎 0

Respond to this Question

First Name

Your Response

Similar Questions

  1. Finance

    . On the day that you were born, your grandfather opened a savings account in your name. At that time, he deposited a certain amount of money into the account, and has deposited the same amount on each of your first 20 birthdays.

  2. math

    Shania deposited $3,000 into a savings account that earns 6.5% simple interest. How much will Shania have in her savings account after 10 years?

  3. Lat math question for some days. Can y'all help?

    Huan deposited $850 into a college savings account earning 4.8% interest compounded annually. He also deposited $850 into a second account earning 4.8% simple interest. He made no additional deposits. After 10 years, which account

  4. math. compounding interest

    regina deposits 3500 in a savings account that pays 7 1/2 % interest , compounded semiannually. how much interest does the account earn in the first 6 months?

  1. FINANCE

    You deposit $2,000 in an account that pays 8% interest compounded semiannually. After 4 years, the interest rate is increased to 8.28% compounded quarterly. What will be the value of the account after 4 more years? (Do not round

  2. Math

    Lee Holmes deposited $16,600 in a new savings account at 9% interest compounded semiannually. At the beginning of year 4, Lee deposits an additional $41,600 at 9% interest compounded semiannually. At the end of year 6, what is the

  3. math

    Huan deposited $850 into a collegesavings account earning 4.8% interestcompounded annually. He also deposited$850 into a second account earning 4.8%simple interest. He made no additionaldeposits. After 10 years, which account

  4. Math

    1. When their child was born, Elaine and Mike Porter deposited $5,000 in a savings account. The money ears interest at 6 percent compounded quarterly. How much will the account be worth when their child celebrates her second

  1. Algebra( check my answers)

    1. Juan deposited $200 in a savings account earning 3% interest over 2 years. What was the total amount of interest earned after 2 years? $12 $24 $120 ( my answer) $240 2. Mary borrowed $11,000 at 5% interest for 4 years. What was

  2. Business Math

    Shelley Katz deposited $30,000 in a savings account at 5% interest compounded semiannually. At the beginning of year 4, Shelley deposits an additional $80,000 at 5% interest compounded semiannually. At the end of 6 years, what is

  3. math

    As a savings plan for college, when their son Bob was born, the Wilburs deposited $10,000 in an account paying 8% compounded annually. How much will the account be worth when Bob is 18 years old?

  4. Business Math

    If $4000 is deposited at the end of each year in an account that earns 6.2% compounded semiannually, how long will it be before the account contains $120,000?

You can view more similar questions or ask a new question.