Answered

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suppose that $2000 is loaned at a rate of 7.5%, compounded semiannually. Assuming that no payments are made, find the amount owed in 6 years. Do not round any intermediate computations, and round your answer

Sagot :

Answer: A = $3111

Step-by-step explanation:

The question is about compound interest and it is specified in particular that it is compounded semiannually. To start, the formula for compound interest should be used.

A = P (1+ r/n)^(nt)

Where:

A = Compounded Amount, $

P = Principal, $

r = Interest Rate

n = Number of times the interest is applied per year

t = Number of periods elapsed, year

Substituting in the equation,

A = $2000 [1 + (0.075/20]^[(2)(6)]

A = $3110.91

A = $3111

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