Study guides

☆☆

Q: How much interest will 10000 earn in 18 months if invested at 8 percent compounded semiannually?

Write your answer...

Submit

Still have questions?

Continue Learning about Math & Arithmetic

I haven't gotten the answer to that test question either....the choices seem wrong

It is 20000*(1.07)^60 = 1158928.54

It will be 726.

If every six months the capital earn 10% interest which is compounded, at the end of 5 years, the interest will be 31875. If the annual interest rate is 10%, it makes no difference how often it is compounded. The six monthly interest rate is adjusted - to 4.88% rather than 5% - so that the total interest for a year is 10%.

$194.25 if interest is compounded annually. A little more if compounded quarterly, monthly, or daily.

Related questions

$5,249.54

888.15

Semiannually over two years is equivalent to 4 periods. If the interest is 12% every 6 months, then the amount of interest is It is 8000*[(1.12)4 -1] =4588.15

It is 1.135^2 - 1 = 28.8%

13.96%

I haven't gotten the answer to that test question either....the choices seem wrong

It is 20000*(1.07)^60 = 1158928.54

It will be 726.

If every six months the capital earn 10% interest which is compounded, at the end of 5 years, the interest will be 31875. If the annual interest rate is 10%, it makes no difference how often it is compounded. The six monthly interest rate is adjusted - to 4.88% rather than 5% - so that the total interest for a year is 10%.

$1480.24

The annual equivalent rate is 15.5625%. The amount invested is irrelevant to calculation of the equivalent rate.

After 5 years, 20000 at 7% per annum compounded semiannually will be 20000*(1 + 0.5*7/100)2*5 = 20000*(1.035)10 = 28211.98

People also asked