Question

Hector makes payments of $2000.00 into an rrsp at the beginning of every six months starting today for 33 years. if the interest rate is 8% compounded semi-annually, calculate the accumulated value.

Answer 1

To calculate the accumulated value of Hector's RRSP, we can use the formula for compound interest. Plugging in the given values, the accumulated value is approximately $254,336.82.

Step-by-step explanation:

To calculate the accumulated value of Hector's RRSP, we can use the formula for compound interest:

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

Where:

Plugging in the values, we get:

A = 2000(1 + 0.08/2)^(2 * 33)

Simplifying, we find that the accumulated value is approximately $254,336.82.