Question

5. Find the Compound Amount.

Round to the nearest cent.

Amount = $15,520
Rate = 6%
Compounded = Semiannually
Time (Years) = 4


6.
Find the Interest Earned.
Round to the nearest cent.

Amount = $15,520
Rate = 6%
Compounded = Semiannually
Time (Years) = 4

Answer 1

5.
Principal Amount = $15,520
Interest rate = r = 6% = 0.06
Compounding Periods = n = 2
Time =t= 4 years

Formula to find compounding amount will be:


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

Using the values, we get:


`A=15520 (1+ (0.06)/(2) )^(2*4)=19660.27`

Thus $19660.27 will be accumulated over a period of 4 years.

6.
Principal Amount = $ 15520
Amount Accumulated = $ 19660.27

Interest Earned = Amount Accumulated - Principal Amount
Interest Earned = 19660.27 - 15520 = $4140.27

Therefore, an interest of $4140.27 will be earned over a period of 4 years.