What is 73000 at 7 percent compounded semiannually for 3 years?

Answer 1

To calculate the future value of $73,000 at a 7% annual interest rate compounded semiannually for 3 years, you can use the formula for compound interest:

[ A = P \left(1 + \frac{r}{n}\right)^{nt} ]

where ( A ) is the amount of money accumulated after n years, ( P ) is the principal amount ($73,000), ( r ) is the annual interest rate (0.07), ( n ) is the number of times interest is compounded per year (2), and ( t ) is the number of years (3).

Plugging in the values:

[ A = 73000 \left(1 + \frac{0.07}{2}\right)^{2 \times 3} \approx 73000 \times (1.035)^6 \approx 73000 \times 1.225 \approx 89,725. ]

Thus, the future value after 3 years is approximately $89,725.