Get the answers you need at Westonci.ca, where our expert community is always ready to help with accurate information. Get detailed and accurate answers to your questions from a community of experts on our comprehensive Q&A platform. Explore comprehensive solutions to your questions from a wide range of professionals on our user-friendly platform.
Sagot :
The annuity that should be worth after 6 years is $63,900.
Given that,
- The present value is $4,500.
- The semi-annual time period should be = 6 × 2 = 12.
- The rate of interest on semi-annual basis should be = 6% ÷ 2 = 3%
Now the following formula should be used:
[tex]Amount = Present\ value \times \frac{(1+ rate)^{(n)} - 1} {rate}\\\\= \$4,500 \times \frac{(1+0.03)^{12} - 1}{0.03}\\\\= \$4,500 \times \frac{0.4257}{0.03}\\\\= \$4,500 \times 14.1920\\\\= \$63,864\\\\= \$63,900[/tex]
Therefore we can conclude that the annuity that should be worth after 6 years is $63,900.
Learn more about the annuity here: brainly.com/question/17096402
Answer: 63900
Step-by-step explanation: Use the savings annuity formula
PN=d((1+r/k)N k−1)r/k
to calculate the value of P6. The question states that r=0.06, d=$4,500, k=2 compounding periods per year, and N=6 years. Substitute these values into the formula results in
P6=$4,500 ((1+0.06/2)6⋅2−1)/(0.06/2).
Simplifying, we have P6=$4,500 ((1.03)12−1)/(0.03). Therefore P6=$63,864.13. Our final answer is 63900.
Thank you for your visit. We're dedicated to helping you find the information you need, whenever you need it. Thanks for using our platform. We aim to provide accurate and up-to-date answers to all your queries. Come back soon. Westonci.ca is committed to providing accurate answers. Come back soon for more trustworthy information.
