Question

3.

Find the compound amount. Round to the nearest cent.

Amount: $23,400
Rate: 3%
Compounded: semiannually
Time (Years): 10


A.)$31,516.52

B.)$27,156.64

C.)$26,910.00

D.)$31,447.73

Answer 1

Correct Answer: Option A

Principal Amount = P = $23,400
Interest rate = r = 3% = 0.03
Time = t = 10
Number of compounding periods in a year = n = 2
Compounded amount = A = ?

Formula for compound interest is:


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

Using the values, we get:


`A=23400(1+ (0.03)/(2))^(2*10)=31516.41`

Option A is the closest one, so its the correct answer