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Sagot :
Answer:
Following are the solution to the given point:
Explanation:
Calculating the value of the effective interest rate:
Formula:
[tex]\text{Effective interest rate} =\frac{\text{annual nominal rate of interest}}{\text{compound year}}[/tex]
[tex]=\frac{12}{2} \\\\ =6\%[/tex]
Calculating the value of Effective annual rate of interest:
[tex]=(1+ \text{The effective rate})^{\text{(compound number )}} -1[/tex]
[tex]=(1+0.06)^2 -1\\\\=(1.06)^2 -1\\\\=1.1236-1\\\\=0.1236\\\\=12.36 \%[/tex]
Calculating the Amount in each semiannual payment:
[tex]= 5000 \times (\frac{F}{P}, 6\% ,9) \times (\frac{A}{P}, 6\%,4)\\\\= 5000 \times 1.689479 \times 0.288591\\\\= 2437.85[/tex]
Calculating the value of the total interest paid:
[tex]= 2437.85 \times 4 - 5000\\\\= 9751.40-5000\\\\ = 4751.40[/tex]
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