Question

You deposit $2500 in a savings account that earns 3% interest, compounded semi-annually. If you

make no additional withdrawals or deposits, how much money will be in your account at the end of
6 years?

Answer 1

$2,725

Explanation:

Amt = Principal · (1 +
`(r)/(n)`)^nt

r = interest rate

n = number of times per year principal compounds

t = number of years

A = 2500 · (1 +
`(.03)/(2)`)^(.03)(2)

A = 2500 · (1 + .015)^(.06)

A = 2500 · (1.015^(.06)

A = 2500(1.09)

A = 2725