Question

Suppose that $2000 is loaned at a rate of 16.5%, compounded semiannually. Assuming that no payments are made, find the amount owed after 10 years.

Do not round any intermediate computations, and round your answer to the nearest cent.

Answer 1

To find compound semiannually, the formula is A=P(1+r/n)^nt

For this problem the equation would be
A = 2000(1+.165/2)^2(10)

Plug this into the calculator to get

9763.1080595

Round to to nearest cent to get

9763.11

Answer: $9763.11